Kyobo Securities Issues KRW 34.8 Billion in Three Series of Equity-Linked Bonds for Hedging, with AA- Credit Rating
Kyobo Securities is issuing three series of equity-linked securities totaling KRW 34.795 billion. This includes the 12556th low-risk grade 5 series at KRW 14.895 billion linked to the KOSPI200 index, the 12557th normal-risk grade 4 series at KRW 9.95 billion linked to Samsung Electronics, and the 12558th normal-risk grade 4 series at KRW 9.95 billion linked to SK Hynix.
Each security is principal-protected, guaranteeing 100% of face value at maturity or upon autocall, with monthly coupon payments contingent on the underlying asset's performance. The autocall threshold is 90% of the initial price for the 12556th series and 100% for the 12557th and 12558th series.
The proceeds will be used for hedging transactions to ensure stable repayment. Kyobo Securities has a strong AA- credit rating, but these securities are not covered by depositor protection. Issuance costs total approximately KRW 1.74 billion.
If total subscriptions fall below KRW 300 million, the issuance may be canceled. The funds are allocated for risk management activities rather than business expansion.
[AI Summary]Kyobo Securities' KRW 34.8 billion ELB issuance is a routine hedging-related debt raise with no equity dilution, thus neutral for shareholders. Backed by a AA- credit rating, the offering provides principal protection but carries market and liquidity risks for investors.