Hana Bank sells US$1 bln in state-backed bonds

SEOUL, April 3 (Yonhap) -- Hana Bank, South Korea's No. 4 lender, said Friday it has raised US$1 billion by selling government-guaranteed bonds, becoming the first local lender to tap into a state debt guarantee program.

The banking unit of Hana Financial Group said the bonds will mature in three
years and carry an interest rate of 4.9 percentage points higher than the London
Inter-bank Offered Rate.
In October, the government decided to offer three-year guarantees of up to $100
billion for foreign debts that local banks bring in by the end of June.
South Korean banks, saddled with high overseas short-term borrowing, had been
suffering from dollar shortages sparked by the collapse of Lehman Brothers
Holdings Inc. in mid-September. But due to fears over the government's management
interference, local banks have been reluctant to use the state debt guarantee
scheme.
Seven financial firms, including Barclays and Citigroup, arranged the sale. The
proceeds from the debt sale will be spent on repaying its maturing foreign
currency debts, Hana added.
The government is seeking to extend its guarantee for local banks' overseas
borrowings by one year until June of 2010 in an effort to help them secure more
liquidity.
sooyeon@yna.co.kr
(END)