December 06, 2019

Korean Air to issue corporate bonds worth $300m

PUBLISHED : August 07, 2019 - 15:32

UPDATED : August 07, 2019 - 15:32

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Korean Air has decided to issue corporate bonds worth $300 million with payment guarantees provided by the state-run Korea Development Bank, according to industry sources Aug. 7.

The firm plans to estimate the demand from Asian and European strategic investors at the end of this month. Credit Suisse, UBS and KDB Asia are organizing this funding. This will be Korean Air’s first issuance of bonds with payment guarantees from the KDB.


Market watchers say global investors are likely to show great interest due to the high credit rating of the country’s largest public financier, issued on the basis of South Korea’s sovereign credit rating. In July, global credit rating agencies Moody’s and Standard & Poor’s respectively assigned South Korea ratings of Aa2, the third-highest level on Moody’s table, and AA. South Korea’s Fitch rating was AA-, the fourth-highest level.

Industry insiders say Korean Air has been trying aggressively this year to secure some money because it hopes to repay some of its debt and also to expand its business.

From the beginning of this year to last month, the total amount of funds secured by Korean Air, both domestically and from overseas, reached 1 trillion won ($822 million). Korean Air also has plans to issue asset-backed securities worth 500 billion won in Korea next month.

By Song Seung-hyun (ssh@heraldcorp. com)

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