[Edaily Marketin KIM YEON-SEO Reporter] As the October corporate bond bookbuilding process enters its final stages, companies are stepping up their fundraising efforts. NH INVESTMENT & SECURITIES, LOTTE rental, and SAMYANGHOLDINGS are conducting bookbuilding among institutional investors.

According to the investment banking (IB) industry on the 18th, three companies—NH INVESTMENT & SECURITIES (AA+), LOTTE rental (A+), and SAMYANGHOLDINGS (AA-)—will conduct bookbuilding for corporate bond issuances this week (October 19–23). HanaFinancialGroupInc. (AA-) is also set to conduct bookbuilding for hybrid capital securities.

First, NH INVESTMENT & SECURITIES will conduct a bookbuilding process on the 20th for the issuance of corporate bonds totaling 130 billion won. By maturity, the issuance consists of 60 billion won in 2-year bonds and 70 billion won in 3-year bonds. Depending on the results of the bookbuilding, the issuance amount may be increased to a maximum of 180 billion won. The target yield band has been set at -30 bp to +30 bp (basis points; 1 bp = 0.01 percentage points) relative to the average yield reported by independent private bond rating agencies. Shinhan Investment Securities is the lead underwriter, and the scheduled issuance date is the 28th.

On the same day, LOTTE rental will also tap the corporate bond market. LOTTE rental plans to issue corporate bonds totaling 300 billion won, divided into 1.5-year, 2-year, and 3-year maturities. The target yield band has been set at -30 to +30 basis points relative to the individual market average rate across all maturities. NH INVESTMENT & SECURITIES, KB Securities, SamsungSecurities, KIWOOM Securities, Shinhan Investment Securities, MIRAE ASSET SECURITIES, Korea Investment & Securities, and HYUNDAI MOTOR SECURITIES are serving as lead underwriters. The scheduled issuance date is the 29th.

HanaFinancialGroupInc. will conduct a bookbuilding process on the 21st for the issuance of 270 billion won in hybrid capital securities. Depending on the success of the bookbuilding, the company plans to increase the issuance amount to a maximum of 400 billion won. The securities have a maturity of 99 years and are structured to allow for the exercise of a call option after five years. The target interest rate has been set at a fixed rate of 4.3% to 4.9% per annum. Korea Investment & Securities and HanyangSecurities are serving as lead underwriters.

SAMYANGHOLDINGS will begin a bookbuilding process on the 23rd for the issuance of corporate bonds totaling 100 billion won. The offering consists of 30 billion won in 2-year bonds, 50 billion won in 3-year bonds, and 20 billion won in 5-year bonds, with the possibility of increasing the total amount to up to 200 billion won. The target yield band was set at –30 basis points to +30 basis points relative to the individual bond’s average market yield. NH INVESTMENT & SECURITIES, KB Securities, Korea Investment & Securities, and SamsungSecurities are acting as underwriters, with the issuance scheduled for the 30th.

With recent rises in market interest rates, investment demand in the corporate bond market continues to center on high-quality bonds with relatively strong credit ratings. Although uncertainty surrounding monetary policy and the burden of high interest rates persist, forecasts suggest that further widening of credit spreads will be limited, as the supply of corporate bonds remains manageable and is supported by “CARRY” demand from investors seeking to secure interest income.

Kim Sang-in, an analyst at Shinhan Investment Securities, stated, “Although two additional benchmark rate hikes are expected through next year, these have already been largely priced into market interest rates, making it difficult to cite them as grounds for a further weakening of credit spreads.” He added, “Favorable credit conditions driven by economic growth and improving corporate earnings, along with low corporate bond supply pressure and robust CARRY demand, are also factors limiting the downward trend.”

He continued, “While we must remain cautious about monetary policy uncertainty and refinancing risks for lower-rated companies,” he added, “the widening of credit spreads toward the end of the year is expected to be limited to a mild decline due to seasonal factors, and we can expect a shift to an uptrend next year as preemptive investment demand flows in ahead of the ‘year-end effect.’”