South Korea may allow sale of corporate bond funds

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SEOUL, Oct 9 (Reuters) South Korea may allow the sale of investment funds specialising in corporate bonds as part of efforts to boost the corporate bond market, a senior official at the financial regulatory agency said on Tuesday.

Jeon Hong-yul, deputy governor of the Financial Supervisory Service, said the authorities wanted the domestic corporate bond market to play a bigger role as a convenient funding source for companies.

''We plan to consider introducing corporate bond investment funds to spur issuances of corporate bonds, including high-yielding bonds,'' Jeon said in his speech at a seminar, without elaborating on the timing.

He said corporate bonds accounted for less than 20 percent of the total outstanding amount of bonds in the domestic market, suggesting that the local bond market has failed to become a major source of funding for companies.

REUTERS SR RAI1140

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