The issuance of government bonds for October will be reduced by 5 trillion won from the initial plan. The government is also considering further reductions in bond issuance if market conditions warrant.
The Ministry of Finance announced the bond issuance plan for October, which includes government bonds, financial securities, and won-denominated foreign bonds.
In October, 12 trillion won in government bonds will be issued through competitive bidding. An additional 500 billion won will be issued through an exchange method between 30-year bonds and benchmark bonds, with the final amount for non-competitive bids to be determined based on the participation of primary dealers and the general public.
The competitive bidding amounts for each maturity are as follows: 2-year bonds at 2.1 trillion won, 3-year bonds at 2.4 trillion won, 5-year bonds at 2.2 trillion won, and 10-year bonds at 2.1 trillion won. Additionally, 700 billion won will be issued in 20-year bonds, 1.8 trillion won in 30-year bonds, 600 billion won in 50-year bonds, and 100 billion won in inflation-linked government bonds.
To enhance liquidity and stabilize the market, the government will also conduct a buyback of maturing government bonds amounting to 3.5 trillion won, with 500 billion won allocated for the exchange between 30-year bonds and benchmark bonds.
No financial securities will be issued in October. Financial securities are used to cover temporary funding shortages that arise from mismatches in revenue and expenditure timing. As of September 30, there were no outstanding financial securities or temporary borrowings from the Bank of Korea. From January 1 to September 30 of this year, the average outstanding amount was 10.5 trillion won in financial securities and 3 trillion won in temporary borrowings from the Bank of Korea.
The won-denominated foreign bonds will be issued at the same scale as the previous month, totaling 1 trillion won. These will be issued as 1-year bonds, with 31 institutions, including primary dealers, preliminary primary dealers, and institutions eligible for currency stabilization bond bidding, participating in the competitive bidding. The bidding will take place on October 23, with payment and issuance scheduled for October 26.
As the government reduces the issuance of October government bonds, a total of 17.403 trillion won in government bonds was issued in September, with a competitive bidding amount of 16 trillion won.
* This article has been translated by AI.
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