Third-Quarter Average Daily Repo Balance Rises 8% YoY to KRW 271 Trillion

The average daily outstanding balance of inter-institutional repurchase agreement (repo) transactions rose 8.13% year on year to KRW 271.2 trillion in the third quarter of this year.

According to the Korea Securities Depository on October 29, the total transaction value increased 2.79% to KRW 12,862 trillion. The repo market is where financial institutions borrow money for very short terms using their own bonds as collateral. Because repo proceeds serve as a source of settlement funds across the financial sector, including stocks, bonds and funds, the market acts as financial plumbing that keeps money flowing.

By institution, asset managers had the largest average daily balance of repo sales, which represent borrowing, at KRW 151.11 trillion (55.72%), followed by domestic securities firms at KRW 75.03 trillion (27.66%).

The average daily balance of repo purchases, which represent lending, stood at KRW 80.63 trillion (29.73%) for domestic banks (trust accounts) and KRW 75.54 trillion (27.86%) for asset managers.

By industry, transactions between asset managers and domestic banks (trust accounts) totaled KRW 3,065 trillion. Transactions between asset managers totaled KRW 2,783 trillion, while those between domestic securities firms and domestic banks (trust accounts) totaled KRW 1,108 trillion.

By average daily outstanding balance, government bonds accounted for the largest share of securities traded, at KRW 142.83 trillion (49.50%). They were followed by financial bonds at KRW 92.34 trillion (32.00%), special bonds at KRW 28.28 trillion (9.80%) and corporate bonds at KRW 10.42 trillion (3.61%).

By currency, the Korean won accounted for the largest share at KRW 240.7 trillion (88.04%), while foreign currencies totaled KRW 32.7 trillion in won-equivalent value, representing 11.96%. The U.S. dollar's share fell 2.16 percentage points from the same period a year earlier.

By transaction term, total settlement amounts were KRW 11,105 trillion for overnight transactions (93.04%), KRW 486 trillion for transactions with terms of 7 to 10 days (4.07%), and KRW 164 trillion for transactions with terms of 2 to 3 days (1.37%).

The most active transaction-size range was KRW 10 billion to KRW 50 billion, accounting for about 38% of transactions by count.

The average overnight rate for inter-institutional repo transactions was 2.84%, compared with 2.81% for the overnight call rate and 2.81% for the Korea Overnight Financing Repo Rate (KOFR).

This content was produced with the assistance of AI translation services.