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Home > Derivatives > Products & Service
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After the financial turmoil in 1997, the Seoul foreign exchange market took a step forward in quantity as well as quality. Along with the development of financial products, the Seoul foreign exchange market merged into one of the key financial centers. To go along with this market change, KMB plays its role as a local broker in inter bank transactions. covering Interest Rate Swaps, Currency Swaps, Foreign Exchange Options, Forward Rate Agreement, and Overnight Index Swaps.
Interdependence among financial products has become an important factor in global finance, and KMB offers the widest breath of financial products to meet the client's demands, considering all aspects of financial management.
We produce a realtime price to interbank derivative traders and provide tailor made service. KMB's derivatives team competes with international broking firms based in Hong Kong or Singapore.
We feel a sense of responsibility to participate in the property of the Seoul derivative market. We search for the best price for our customers to meet their demands.
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| Interest Rate Swap |
Interest Rate Swap refers to a transaction in which two parties exchange or swap interest rate payment calculated by using two different interest rate indices to a common, notional principal. Utilizing a variable interest rate and a fixed interest rate is conventional.
▶ Currency : KRW/KRW
▶ Term : 1Y, 2Y, 3Y, 4Y, 5Y, 7Y, 10Y and Odd date
▶ Principal Amount : Minimum of KRW 1.0 billion, to be increased by KRW 0.1 billion thereafter
▶ Trading Hour : No restriction
▶ Price Quoting : KRW fixed rate (Quoted as % p.a. to the second decimal place)
▶Payment frequency:Quarterly Actual/365 (fixed) Basis, Semi-annual, yearly payments also negotiable
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| Currency Swap |
Currency Swap refers to the type of transaction where two different currencies are being exchanged or swapped at a certain period of time. After an agreed period, the currencies are reexchanged or swapped back along with the interest payment due from the bidding party.
▶ Currency : USD/KRW
▶ Term : 1Y, 2Y, 3Y, 4Y, 5Y, 7Y, 10Y and Odd date
▶ Principal Amount : Minimum of USD 0.5 million, to be increased to USD 0.1 billion thereafter
▶ Trading Hour : No restriction
▶ Fixed Rate : KRW
▶ Floating Rate : USD
▶Payment frequency:Semi-annually Actual/365 (fixed) Basis, Quarterly, yearly payments also negotiable
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| Foreign Exchange Option |
Currency option between Korean Won(KRW) and US Dollar(USD) refers to the product having the right to buy and sell at a specific exchange rate in the future at expiration date.
▶ Currency : USD/KRW Call and Put
▶ Term : 1M, 2M, 3M, 6M, 1Y and Odd date
▶ Principal Amount : Minimum of USD 0.5 million, to be increased to USD 0.1 billion thereafter
▶ Trading Hour : AM 09:30 ~ 12:00 and PM 13:30 ~ 16:30
▶ Price Quoting : Implied Volatility(%, to the second decimal place)
▶ Cut Off Time : Buyer to notify seller not later than 15:00, Seoul time on expiry date.
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| Over-night Index Swap |
OIS(Over-night Index Swap) refers to a transaction of exchanging or swapping of fixed rate and floating rate in the same manner as IRS. However, OIS differs from IRS in its comparatively shorter term and utilizing overnight C2 rate as the floating rate.
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| Forward Rate Agreement |
FRA refers to a transaction as two parties with hedging or speculating interest in the future interest rate movement. It specifies an interest rate to be part as an obligation beginning at some future date.
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