24% decrease in stock issuance last year… Declining corporate bond issuance

24% decrease in stock issuance last year… Declining corporate bond issuance
24% decrease in stock issuance last year… Declining corporate bond issuance

Due to the weak stock market, both IPO and paid-in capital increase decreased
Corporate bond issuance 9.8%↓… Deterioration of issuance conditions due to interest rate hike

(Seoul = Yonhap Infomax) Reporter Ondaye = Due to the weak stock market last year, it was found that the stock offering issuance performance has shrunk significantly compared to 2021. Corporate bond issuance also declined due to interest rate hikes.

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According to the ‘2022 Corporate Direct Financing Procurement Performance’ announced by the Financial Supervisory Service on the 25th, the stock offering issuance last year recorded 21.9408 trillion won.

As both IPOs and paid-in capital increase decreased due to the weak stock market, the issuance performance decreased by 7.1495 trillion won (24.6%) compared to the previous year (2021), which was the largest ever.

The number of IPOs was 115, an increase of 5 from 110 in the previous year, but the amount decreased by 8.1% from 13,351.5 billion won to 14,522.5 billion won.

As the public offering stock market shrank, listing on the KOSPI decreased significantly from 14 cases in 2021 to 4 cases last year.

Last year, the scale of IPOs was 10.5268 trillion won (4 cases) in the KOSPI market and 2.8247 trillion won (111 cases) in the KOSDAQ market.

The performance of paid-in capital issuance also decreased by 41% from 14.5678 trillion won in 2021 to 8.5893 trillion won last year.

This is because the number and amount of paid-in capital increase of KOSPI-listed companies decreased by half compared to the previous year as the stock market continued to be weak.

As the issuance conditions deteriorated due to the interest rate hike last year, the performance of corporate bond issuance also shrank.

General corporate bonds, financial bonds, and ABS (asset-backed securities) all decreased, and corporate bond issuance was 182.6339 trillion won last year, down 19.7551 trillion won (9.8%) from the previous year.

In the case of general corporate bonds, it recorded 30.373 trillion won, which is a 35% decrease from the previous year. The proportion of quality water grade AA or higher increased from 66.6% to 75.5%, and non-prime water grade A or BBB grade or lower decreased from 33.4% to 24.5%.

As economic uncertainty such as interest rates continued, the proportion of long-term bonds (greater than 5 years) decreased and mid-term bonds (greater than 1 year and less than 5 years) increased, showing a tendency for the issuance period to be shortened. Corporate bond issuance focused on debt repayment rather than facility and operating funds accounted for the majority at 60.6%.

Financial debentures recorded 138.328 trillion won, down 1.1% from the previous year, and ABS recorded 14.2281 trillion won, down 11.4% from the previous year.

The amount of CP (commercial paper) and short-term bonds issued totaled 1,555.4179 trillion won, down 101.082 trillion won (6.1%) from the previous year.

The amount of CP issued last year was 432.905 trillion won, up 4.8% from the previous year, while short-term bonds recorded 1112.5129 trillion won, down 9.7% from the previous year.

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