Cho Hung Bank drops sub debt plan

The Korean bank postpones a $250 million issue after failing to get MoFE approval.

Korea's Ministry of Finance and the Economy MoFE has put paid to plans for a $250 million upper tier 2 debt issue just a week before roadshows were due to start. Salomon Smith Barney was mandated for a 10 non-call five offering by the government-owned bank last month, having previously held a mandate for a hybrid transaction.

However, news of a prospective sub debt issue immediately raised eyebrows among Asian FIG experts, since Cho Hung is in the process of being merged with the Shinhan Financial Group - the one bank, which will need a boost to replenish capital written off as a result the acquisition.

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