KOREA Exchange Bank has launched its HK$1.1 billion floating-rate note (FRN) and the issue is expected to be the first by a Korean bank to gain access to the Hong Kong Monetary Authority's liquidity adjustment facility (LAF).
The issue was arranged by Asahi Finance (Hong Kong), Bayerische Landesbank (Hong Kong), Chemical Securities Asia and Sakura Finance Asia.
Issue price was par, Chemical Securities said, with commitments of HK$75 million to HK$100 million receiving fees of 25 basis points. Commitments of HK$50 million to HK$74 million received 20 basis points, and HK$30 million to HK$49 million earned 15 basis points.
Originally planned as a US$150 million deal, Korea Exchange Bank opted for Hong Kong dollars after one bank proposed a Hong Kong dollar LAF-eligible issue.
The bank had sought HK$1.2 billion, but reduced it to $1.1 billion because it had secured approval for US$150 million.
LAF eligibility makes FRNs more desirable because holders can engage in repurchase agreements with the monetary authority.
