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Standard Bank Asia has completed syndication of a new US$30mn floating rate note (FRN) for a leading South Korean leasing company, Shinhan Capital Co, a 100% owned subsidiary of Shinhan Financial Group Co.
Standard Bank Asia and Daewoo Securities Europe acted as joint lead arrangers, underwriters and bookrunners with Maybank Hong Kong, Korea Development Bank London, Export-Import Bank London, Pusan Bank Seoul as co-lead managers, PT Bank Negara Indonesia as co-manager and Shinhan Finance as paying agent.

This FRN has a tenor of three years with bullet repayment at maturity. The FRN is unsecured and contains a covenant for Shinhan Financial Group to maintain management control and 50% ownership of the issuer.

This FRN is a landmark issue for Korean borrowers, not only because this is the maiden international fund raising for Shinhan Capital, but also the first international fund raising by a Korean non-bank financial institution since the 1997 financial crisis.

Shinhan Capital is the biggest specialized leasing company in Korea.  It is a 100% owned subsidiary of Korea’s second largest financial holding company, Shinhan Financial Group. The Shinhan Financial Group has a Korea Rating of AAA, with Shinhan Capital being rated A. Differentiating itself from its competitors by focusing on the leasing of machinery items, ships and printing machines, it had the largest market share in Korea in the lease financing sector in 2003. Building upon this achievement, it is now diversifying its businesses by providing financing to corporate restructuring companies and for automobile installments, real estate projects and infrastructure investments.  As of March 31, 2004, it had total assets of W1,222.5bn (US$1.0206bn), paid-in capital of W80bn (US$66.8mn) and 65 employees.