South Korea’s investment in foreign securities falls in Q3
November 29th, 2011 - 1:36 pm ICT by IANS
Seoul, Nov 29 (IANS) Foreign securities invested by South Korea’s financial institutions plunged in the third quarter due to sharp declines in the share price of major investment destinations, the central bank said Tuesday.
Foreign currency-denominated securities held by domestic financial institutions reached an outstanding $57.8 billion as of the end of September, down $11.14 billion from three months earlier, according to the Bank of Korea (BOK).
The third-quarter figure was the smallest since $51.86 billion tallied in the first quarter of 2009 when the global financial market was roiled by the Lehman Brothers’ collapse, reported Xinhua.
Investment in overseas stocks contracted $10.46 billion on-quarter to reach $27.13 billion as of end-September amid sharp drops in major stock markets. Stocks in the European Union (EU) tumbled by 23.5 percent during the July-September period, with those of China, China’s Hong Kong, Brazil and the US diving by 29.1 percent, 21.5 percent, 16.2 percent and 12.1 percent respectively, according to the BOK.
The central bank mainly attributed the third-quarter contraction to plunges in the mark-to-market valuations of foreign stocks amid stock price falls, saying that local asset managers also faced some retrieval of money invested in foreign stock-typed funds.
Meanwhile, investment in foreign bonds stood at $14.12 billion as of the end of September, down $460 million from three months before, while the Korean Paper investment edged down $220 million on-quarter to $16.54 billion as of end-September.
The Koran Paper refers to foreign currency-denominated securities sold overseas by the South Korean government, financial institutions and companies.
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Tags: asset managers, bok, china china, contraction, domestic financial institutions, foreign currency, foreign securities, global financial market, investment destinations, korean paper, lehman brothers, market valuations, paper investment, plunges, share price, south korea, south korean government, stock markets, stock price, xinhua