Hana Bank said on the 21st that it issued a $100 million five-year foreign currency digital bond. Standard Chartered (SC) served as sole arranger, handling the bond's structuring, issuance and sale.
The bond was issued through D-FMI, the blockchain platform of Euroclear, an international central securities depository (ICSD). It marks the first time a Korean financial firm has used D-FMI directly to issue a digital bond.
Digital bonds handle bond operations such as issuance, registration and settlement using distributed ledger technology (DLT), including blockchain. With conventional bonds, multiple participants must each process and reconcile information, but DLT processes information on a shared ledger, improving operational efficiency and shortening settlement periods.
Notably, Hana Bank shortened the settlement period to same-day for the first time in Korea's foreign currency bond issuance market. As bond allocation and fund transfers were processed instantly on the DLT, issuance and settlement procedures that normally take three to five business days were completed within the day. A Hana Bank official said, "Shortening the settlement cycle has improved the stability of our funding."
Connectivity with existing financial infrastructure was also maintained. Because D-FMI is linked to Euroclear's existing global settlement network, there is no need to build a separate investment system. Hana Bank used documentation from the global medium-term note (GMTN) program it had employed for previous foreign currency bond issuances, and institutional investors can also use their existing Euroclear accounts and trading systems.
Hana Financial Group has recently been expanding efforts to apply blockchain technology to actual financial infrastructure. In February, it completed a proof of concept (PoC) with Dunamu for a blockchain-based foreign currency remittance service. The approach processes remittance messages, previously exchanged via the SWIFT international financial messaging network, on Dunamu's GIWA Chain. Hana Financial Group is pursuing plans to expand this into foreign currency remittance infrastructure using deposit tokens and to commercialize it after obtaining innovative financial service designation.
A Hana Bank official said, "This digital bond issuance and the realization of 'T+0' settlement go beyond diversifying funding channels — it is a meaningful attempt to actively apply blockchain technology to capital markets," adding, "We will continue to seek innovative funding methods."
