KDB turns to FRN market

Policy bank issues a rare floating rate note.

KDB broke new ground for Asian issuers yesterday October 13 with an increased $550 million FRN via Goldman Sachs and Morgan Stanley. The five-year deal underlines the group's reputation as the region's most sophisticated borrower and was well-timed to take advantage of shifting investor appetite.

Where traditionally only about 20% of global issuance is in FRN format, bankers say the figure is more like 50% so far this year as investors look for more defensive instruments in a rising interest rate environment. As such, KDB's deal may mark a turning point for the Asian bond market. Indeed, observers say it represents only the second ever SEC-registered FRN from non-Japan...

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