Samsung Securities (016360.KS) sold out its first promotional issuance of short-term notes in two and a half days, part of a push into the market for mega-sized investment banking.
The one-year promotional note, launched on the 21st, exhausted its 100 billion won ($72 million) sales target in two and a half days, the brokerage said on the 23rd. As a latecomer to the business, Samsung Securities drew demand from individual and corporate investors seeking places to park short-term funds by offering a competitive rate.
The product is available to holders of comprehensive accounts and pays 4.3% a year before taxes, with subscriptions ranging from 1 million won to 300 million won per person.
Apart from the promotional offering, the brokerage's regular short-term notes pay 4.6% a year for installment-type accounts and 2.55% for on-demand accounts. Fixed-maturity products carry rates of 2.65% to 3.95% a year depending on the term.
Short-term notes are financial instruments with maturities of up to one year, issued on the credit of mega investment banks with equity capital of at least 4 trillion won. Samsung Securities received a license for the short-term financing business on the 9th of this month, becoming the country's eighth issuer of such notes.
The brokerage plans to use the proceeds to expand its supply of risk capital. It aims to meet corporate demand for productive financing and build a sustainable financial infrastructure based on mutual growth.
"We will expand differentiated financial products so that we can offer customers stable and attractive returns while serving as seed money for corporate growth," an official at Samsung Securities said.
