Hyundai Card has become the first domestic credit finance company to issue a dual-currency kimchi bond, combining U.S. dollars and Chinese yuan. This move is seen as a strategy to diversify funding sources amid increasing volatility in the financial markets.
On June 17, Hyundai Card announced the public issuance of dual-currency kimchi bonds totaling 1.287 trillion won. These bonds are classified as Korean-style green bonds, intended for financing eco-friendly mobility initiatives.
The issuance consists of $20 million in dollar bonds (approximately 302 billion won) and 440 million yuan in yuan bonds (approximately 985 billion won). The dollar bonds have a one-year maturity, with an interest rate set at the risk-free reference rate (RFR) SOFR plus 77 basis points. The yuan bonds have a two-year maturity and an interest rate of 2.09%.
Hyundai Card expects this issuance will expand its foreign currency funding channels and mitigate currency-specific funding risks. By including yuan bonds, the company aims to tap into the growing base of Chinese investors in the domestic bond market, thereby securing new demand.
These bonds comply with the Ministry of Environment's Korean-style green classification system. The funds raised will be allocated to financing services related to Hyundai Motor Group's electric vehicles (EVs) and hydrogen fuel cell vehicles (FCEVs).
A Hyundai Card official stated, "In a challenging funding environment due to increased volatility in domestic and international financial markets, this dual-currency kimchi bond issuance is expected to expand our investor base and diversify currency-specific funding risks. We will continue to utilize various funding methods to secure stable liquidity and enhance our funding competitiveness."
* This article has been translated by AI.
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