November 2020 Treasury Bond Issuance Plan

 

The Ministry of Economy and Finance plans to issue Korea Treasury Bonds worth approximately 12,400 billion won in November 2020 through competitive bidding.

 

November 2020 Auction Schedule

                                                                 (KRW billion)

¹ F = fungible issue, P = pre-issuance

 

1) Non-competitive bids option I

 

For retail investors, KTBs worth 2,480 billion won (no more than 20% of the offered amount in the auction excluding 50Y KTBs) will be allocated first at the highest accepted bid rate.

 

2) Non-competitive bids option II

 

A non-competitive purchasing option II is granted to primary dealers (PD) whereby PDs can make additional purchases of 10%-35%^* of the accepted bid amount within three business days after the auction.

 

* Up to 25% of the option is granted to the top-performing PDs, 20% to the 2^nd best-performing PDs, 15% to the 3^rd best-performing PDs, and 10% to the rest, according to their market-making performances for the last six months. MOEF will grant additional 5~10%p to best performing PDs in the monthly evaluation.

 

3) Non-competitive bids option III

 

KTB STRIPS^* are supplied on the third business day after the auctions, 208 billion won for 3Y and 5Y KTBs, 258 billion won for 10Y and 30Y KTBs, and 160 billion won for 20Y KTBs. PDs that have obtained the right to purchase these KTB STRIPS can make purchases of up to 20 billion won.

 

* The option is granted according to the outcomes of monthly evaluation conducted in the previous month, and the PDs have to meet their obligations of separating interest and principal for their purchases over the next month.

 

4) Inflation-linked Korea Treasury Bonds (KTBi)

 

KTBi underwriting rights are granted to PDs within 10%^* the scheduled amount of issuance for the month, 100 billion won, which can be exercised on the same day of the 10Y KTB auction date and the following day.

 

* If the total amount of the bidding exceeds the issue amount of the month, KTBi will be allocated by the unit of one billion won according to the allocation standards, such as bidding amounts.

 

Non-PDs & Non-PPDs (retail investors) can purchase KTBi worth up to 10 billion won (up to 10% of scheduled issue amount for the month) through PDs on the 10Y KTB auction date and the following business day after the auction.

 

* KTBi interest rate spread will be adjusted to the average spread of five business days before the competitive 10Y KTB bidding.

 

5) Buyback

 

 

* Further details will be provided on November 9, and 13 respectively on the BOK website.

 

6) Conversion offer

 

 

* Further details will be provided on November 10, and 17 respectively on the BOK website.