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Corporate bond issuance falls on economic uncertainties

All Headlines 06:00 August 30, 2016

SEOUL, Aug. 30 (Yonhap) -- South Korean firms continued to reduce equity and bond issuance in July, government data showed Tuesday, amid lingering uncertainties over business conditions at home and abroad.

The value of stocks and bonds issued during the month totaled 10.87 trillion won (US$9.6 billion), down 7.8 percent from June, according to the Financial Supervisory Service (FSS). Equity and debt issuance fell by 38.1 percent and 4.9 percent, respectively.

"In general, local companies seem to be reluctant to make new investments due to the restructuring drive and economic uncertainties," an FSS official said. "Demand appears relatively lackluster as well due to low interest rates."

Corporate bond issuance fell 4.9 percent to 10.2 trillion won in June from a month earlier.

Equity issuance through initial public offerings (IPOs) slid 29.8 percent to 251.6 billion won. Secondary offerings also decreased 42.6 percent to 376.8 billion won.

Outstanding corporate bonds came to 412.1 trillion won as of end-July, up 0.9 percent from June.

Meanwhile, the issuance of commercial papers and asset-backed short-term bonds rose 0.5 percent to 119.7 trillion won in July.
lcd@yna.co.kr
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