S Korea-FX stabilization bonds

S. Korea sells US$1.3 bln of FX stabilization bonds

By Kim Soo-yeon

SEOUL, Oct. 7 (Yonhap) -- South Korea said Thursday it has successfully sold about US$1.3 billion worth of foreign exchange stabilization bonds.

The government sold U.S. dollar-denominated bonds worth $500 million with a maturity of 10 years and five-year euro-denominated debts worth $700 million, according to the finance ministry.

The dollar bonds carry a yield of 1.769 percent, or 25 basis points more than the rate of U.S. 10-year Treasuries, while the euro bonds carry a yield of minus 0.053 percent, it added.

Currency stabilization bonds are designed to raise money needed for the government to keep foreign exchange rates stable.

Their yields often serve as a benchmark for Korean bonds being traded in international financial markets.

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