Outstanding investment in foreign securities by local financial institutions came to 395.88 billion U.S. dollars at the end of March, down 2.8 percent from three months earlier, according to the Bank of Korea.
It was the fastest quarterly reduction in almost nine years since the second quarter of 2013.
The institutional holdings of foreign bonds tumbled by 6.74 billion dollars during the January-March quarter amid rising expectations for the tightened monetary policy in major economies.
The ownership of foreign stocks declined 1.46 billion dollars during the quarter as major stock indices in the United States and Europe slipped in single digits.
The institutional holdings of Korean Paper, which refers to the foreign currency-denominated bonds issued overseas by local institutions or companies, retreated by 3.08 billion dollars in the cited quarter.
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