South Korea considers using exchange fund to buy dollars raised from SK Hynix ADR issuance
The Korea Economic Daily quoted an unnamed investment bank manager as reporting that South Korea’s foreign exchange management department is discussing purchasing U.S. dollar funds related to SK Hynix’s ADR issuance through the Foreign Exchange Stabilization Fund to prevent fluctuations in the U.S. dollar/South Korean won. According to reports, SK Hynix plans to use most of the funds raised through the ADR issuance for domestic investment, and a large amount of US dollars is expected to flow into the domestic foreign exchange market. There is speculation that if foreign exchange control agencies use the Exchange Stabilization Fund to purchase U.S. dollars, they are most likely to conduct over-the-counter transactions through banks.