The balance of overseas foreign currency securities investments by domestic institutional investors grew by nearly 10% in the second quarter (April to June) of this year, driven by rising stock prices in major economies such as the United States.

According to the "Trends in Foreign Currency Securities Investments by Major Institutional Investors in the Second Quarter" released by the Bank of Korea today (Sept. 1), the balance of foreign currency securities held by major domestic institutional investors (based on market value) stood at $549.68 billion (approx. 753.3 trillion won) as of the end of June.

This represents a 9.3% ($46.72 billion) increase over the three-month period compared to the end of March ($502.96 billion).

This marks the largest quarterly increase on record since relevant statistics began in 2014.

The balance of institutional foreign currency securities investments rose for four consecutive quarters starting from the first quarter of last year, declined in the first quarter of this year, and has now rebounded.

By investment entity, asset management companies (+$44.66 billion), foreign exchange banks (+$2.81 billion), and securities firms (+$100 million) saw increases, while insurance companies (-$840 million) experienced a decrease in their investment balances.



By asset type, foreign equities increased by $45.76 billion, while foreign bonds remained at the previous quarter's level.

The increase in foreign equities was also the largest on record.

Korean paper—foreign currency-denominated securities issued abroad by domestic financial institutions and corporations—increased by $960 million.

A Bank of Korea official explained, "Valuation gains occurred due to rising stock prices in major countries, and net investments in foreign equities continued, centered around asset management companies."

The official added, "Foreign bonds remained at the previous quarter's level as a contraction in investment sentiment due to concerns over falling bond prices from rising interest rates was offset by incentives for bargain hunting."

(Photo provided by Bank of Korea, Yonhap News)