Domestic residents' foreign currency deposits in South Korea reached $113.33 billion at the end of June, rising $1.08 billion from the previous month, according to Bank of Korea data released on the 27th. The increase was driven by growth in securities firms' customer deposits and corporate trade receipts, marking the third consecutive monthly rise. The deposits had rebounded in April after a record $15.37 billion decline in March, reflecting stabilization in foreign currency holdings among both corporate and individual account holders.
Dollar Deposits Rise $2.25 Billion While Yen and Euro Deposits Decline
Dollar-denominated deposits increased $2.25 billion to $97.8 billion at the end of June. The growth was attributed to increased trading collateral for exchange-traded derivatives and overseas securities investor deposits at securities firms, according to the Bank of Korea's capital flow analysis team. A Bank of Korea official stated that while trade receipts increased, inflows and payments offset each other, with securities firms' customer deposits accounting for the majority of the growth.
Yen deposits decreased $410 million to $7.12 billion, affected by trade payment obligations. Euro deposits fell $460 million to $5.84 billion due to corporate loan repayments. Yuan deposits declined $20 million to $1.27 billion, while deposits in other currencies including British pounds and Australian dollars decreased $280 million to $1.3 billion.
The Bank of Korea confirmed that dollar funds related to SK Hynix's American Depositary Receipt (ADR) listing were not included in the June statistics. A Bank of Korea official stated that SK Hynix listing-related funds began flowing in from mid-July and were not reflected in the June data.
Corporate Deposits Increase $1.58 Billion as Individual Deposits Fall $500 Million
Corporate foreign currency deposits rose $1.58 billion to $98.99 billion at the end of June, representing 87.4% of total resident foreign currency deposits. Corporate deposits have increased for three consecutive months since turning positive in April. Corporate dollar deposits specifically grew $2.59 billion to $85.58 billion.
Individual deposits declined $500 million to $14.33 billion, marking the second consecutive monthly decrease. Individual dollar deposits fell $350 million to $12.22 billion.
Domestic Banks and Foreign Bank Branches Report Mixed Growth
Domestic banks' resident foreign currency deposits reached $92.78 billion, up $50 million from the previous month. Foreign bank branches operating in South Korea reported deposit balances of $20.55 billion, an increase of $1.03 billion.
Resident foreign currency deposits include holdings by domestic individuals and companies as well as foreigners who have resided in South Korea for six months or more and foreign companies operating domestically.
FAQ
What caused South Korea's foreign currency deposits to increase in June?
The $1.08 billion increase was driven by growth in securities firms' customer deposits, including trading collateral for exchange-traded derivatives and overseas securities investor deposits, along with corporate trade receipts.
How much did corporate dollar deposits grow in June?
Corporate dollar deposits increased $2.59 billion to reach $85.58 billion at the end of June, while individual dollar deposits fell $350 million to $12.22 billion.
Were SK Hynix ADR-related funds included in the June data?
No. A Bank of Korea official confirmed that SK Hynix listing-related dollar funds began flowing in from mid-July and were not reflected in the June statistics.
