South Korea has granted HSBC Holdings a licence to arrange and underwrite won debt in the country. 'This licence allows us to participate in the Korean won primary business and gives us access for the first time to Asia's largest domestic bond market,' said Stuart Gulliver, HSBC's treasurer. Mark Bucknall, head of capital markets at HSBC Markets, said the size of South Korea's won-denominated currency debt market was about 360 trillion won (about HK$2.32 trillion) at the end of May. That makes it the largest domestic-currency bond market in Asia, excluding Japan. He said the market was quiet at present but the licence would allow the bank to build the infrastructure necessary to do business when activity picked up. Mr Bucknall said that South Korea's domestic-currency debt market had not been dominated by government issues as in other parts of Asia, which created more opportunities for foreign banks to arrange corporate deals. HSBC is the 13th foreign financial institution to receive such a licence. Morgan Stanley Dean Witter and Merrill Lynch have received similar approvals in the past. Mr Bucknall said both foreign institutions and securities companies owned by South Korean conglomerates were equally active in the market. The granting of the licence is a major development for the banking group in South Korea after it stopped negotiations to buy Seoulbank in August.