| Kimchi bond | |
| Hangul | 김치본드; 김치채권 (rare) |
|---|---|
| Hanja | none; 김치債券 |
| Revised Romanization | Gimchi Bondeu; Gimchi Chaegwon |
| McCune–Reischauer | Kimch'i Pondŭ; Kimch'i Ch'aekwŏn |
A Kimchi bond is a non-won-denominated financial bond issued in the South Korean market. The name refers to kimchi, a Korean side dish. Woori Bank, which is credited with coining the term, defines it as solely referring to bonds from foreign issuers, a definition echoed by the Ministry of Finance and Economy. However, in practice, the term is also used to refer to non-won-denominated bond issuance by domestic entities. Deutsche Bank credits itself as having executed the first kimchi bond transaction, a US$100 million two-year floating rate note sold by South Korean company SK Global, but the first foreign company to sell non-won-denominated bonds in the South Korean market was Bear Stearns. Although foreign firms had long been permitted to issue won-denominated bonds, typically referred to as Arirang bonds, permission for them to issue foreign currency-denominated bonds was slower in coming. Permission was finally granted due to the strength of the won in 2005.
References
- Gwon, Yeong-seok (2006-05-24). "'김치본드' 내달 처음으로 선보인다 (Announcement: first 'Kimchi Bonds' next month)". The Hankyoreh. Retrieved 2007-07-06.
- ^ "'Kimchi' bonds for Koreans". The Standard. 2006-05-25. Archived from the original on 2007-09-29. Retrieved 2007-07-06.
- ^ "Supplement to MOFE Press Release: 2nd Meeting of the Financial Hub Initiative Committee". Ministry of Finance and Economy. 2006-06-19. Retrieved 2007-07-06.
- ^ "Deutsche Bank Group Profile: Korea" (PDF). Deutsche Bank. October 2006. Archived from the original (PDF) on 2007-05-08. Retrieved 2007-07-06.
- "SK Shipping prepares kimchi". Jane's Transport Finance. 2007-06-21. Retrieved 2007-07-06.
- Kim, Jung-min (2005-04-24). "Woori considers issuing dollar-denominated 'kimchi bond'". Herald Media. Archived from the original on 2004-08-13. Retrieved 2007-07-06.