Outstanding investment in foreign securities, including stocks and bonds owned by local financial institutions, stood at 367.55 billion U.S. dollars at the end of September, down by 5.90 billion dollars from three months earlier, according to the Bank of Korea (BOK).
The reduction was attributable to the mark-to-market losses from lower global stock prices and higher interest rates in major economies that decreased the evaluation of foreign bonds.
The institutional holdings of foreign stocks diminished by 1.54 billion dollars in the July-September quarter, while the ownership of foreign bonds retreated by 3.28 billion dollars.
The holdings of Korean Paper, which refers to the foreign currency-denominated bonds issued overseas by domestic institutions and companies, slumped by 1.07 billion dollars in the cited quarter.
Foreign securities owned by asset management companies, insurers and securities firms shrank in the third quarter, but the foreign exchange banks-possessed securities gained ground.
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