The Export-Import Bank of Korea (www.koreaexim.go.kr Chairman Kim Yong-hwan, “Korea Eximbank”) announced on February 5 that the Bank successfully issued a SFr 220 million (roughly equivalent to USD 250 million) bond for the first time among Asian agencies this year.

This represents the first SFr bond issued by Korea Eximbank in almost three years since March 2011.

The issue was made in a dual-tranche* structure, consisting of SFr 125 million in 3-year maturity bonds and SFr 100 million in 5.5-year maturity bonds.

*Dual Tranche: issuing bonds in two different maturities

Pricing on the 3-year and 5.5-year tranches has been set at CHF 3M Libor+0.45% and CHF+0.55%, the lowest levels achieved in their respective maturities since the global financial crisis.

SFr swap interest rate : a reference rate used for cross-border financial transactions by Switzerland.

At a time of growing uncertainties in the global financial market, the fact that Korea Eximbank successfully sold bonds to avowedly conservative Swiss investors has great significance.

The bond issue, made in the midst of a financial turmoil sweeping emerging markets as the result of additional QEtapering and a slowdown in China’s growth, served to bolster Korea’s status in the international capital market with its competitive pricing.

The success is attributed in part to President Park Geun-hye’s state visit to Switzerland last month.

During this visit, President Park is credited to have elevated the interest and confidence of Swiss investors in Korean bonds by actively publicizing Korea’s economic stability.

A Korea Eximbank official remarked “Our strategy of segmenting our offering to suit investor demand, which we applied with success to our global bond issue in January, has paid off once again. The dual-tranche structure consisting of 3-year, variable-rate notes and 5.5-year, fixed-rate notes allowed us to effectively absorb a mixture of short-term and long-term investor demand.

Korea Eximbank’s SFs bond issue is reputed to have set a new benchmark for other Korean financial institutions seeking foreign currency funding in the conservative euro area and Swiss currency markets.

The foreign currency proceeds of the bond issue will go to supporting the globalization of core industries making up the creative economy including overseas construction, industrial plants, ships & offshore platforms, natural resource development, and climate change mitigation.