대한민국 상태가 영... 좋지않네요 외환보유고가 왜이렇게 급락하는거지?

- The Bank of Korea's foreign exchange reserves fell by $5.99 billion compared to the previous month, requiring a strict parliamentary audit of the government. -

대한민국 상태가 영... 좋지않네요 외환보유고가 왜이렇게 급락하는거지?

On May 7, 2024, the Bank of Korea unveiled its "foreign exchange reserves" for April 2024.

The nation's foreign exchange reserves stood at $413.6 billion at the end of April 2024, down "$5.99 billion (about 8.14 trillion won) from the end of March 2024, according to data from the Bank of Korea.

The Bank of Korea says the reasons for the decrease in foreign exchange reserves are as follows.

In other words, it was due to market stabilization measures such as foreign exchange swaps with the National Pension Service, a decrease in foreign currency deposits by financial institutions due to the disappearance of the effect at the end of the quarter, and a decrease in the conversion of other currency-denominated foreign currency assets to the US dollar.

Summarizing this, foreign exchange reserves of as much as $5.99 billion (about 8.14 trillion won) fell in April 2024 due to "the Bank of Korea's market stabilization measures," "a decrease in foreign currency deposits by financial institutions," and "a decrease in the amount of U.S. dollar conversion of foreign currency assets."

For reference, the Bank of Korea's foreign exchange reserves are defined as follows.

Foreign exchange reserves refer to external payment preparation assets held by the central bank or the government so that they can be used at any time to compensate for the imbalance in the balance of payments or to stabilize the foreign exchange market.

Let's also look at the definition of the IMF's Foreign Exchange Reserves.

According to the IMF, "foreign exchange reserves" refer to "exchangeable, liquidity and marketable assets that can be used at any time by the central bank and the government, which are monetary authorities."

In other words, the definition of the IMF's foreign exchange reserves should be "foreign foreign currency financial assets" with functions of "exchangeability," "liquidity," and "marketability."

Thus, the Bank of Korea can use its foreign exchange reserves for "market stabilization measures."

In addition, it can be said that the "reduction in foreign currency deposits of financial institutions" is an inevitable part of the Bank of Korea.

But the third factor, the "decrease in U.S. dollar conversion of foreign currency assets," was the Bank of Korea's misconduct in managing its foreign reserves of $419.25 billion (about W570 trillion) in March 2024.

For example, the composition of assets of the Bank of Korea's foreign exchange reserves of "$419.25 billion (approximately 570 trillion won)" in March 2024 is as follows.

The "Asset Portfolio" of the Bank of Korea's foreign exchange reserves consists of "370.61 billion dollars (89.7%) in securities," "18.85 billion dollars (4.6%) in deposits," "SDR 14.64 billion dollars (3.5 percent)," "gold 4.79 billion dollars (1.2 percent)" and "IMF position 4.37 billion dollars (1.1 percent)."

Then, here, we will look at the Bank of Korea's "Asset Portfolio" one by one.

1. securities

The problematic part here is "$370.61 billion (89.7%) in securities," which accounts for the largest portion of the Bank of Korea's foreign exchange reserves.

Securities refer to reliable foreign bonds (such as government bonds, state government bonds, corporate bonds, and asset-backed securities (ABS, covered bonds) that are exchangeable, liquidity, marketable, and profitable.

However, the Bank of Korea defines securities as follows.

In other words, "national bonds, government bond bonds, corporate bonds, asset-backed securities (MBS, covered bonds), etc." are referred to as securities.

It feels like something's been turned around.

Because MBS (Mortgage-Backed Securities) is a type of asset-backed securities (ABS).

For example, it is as follows.

Asset-backed securities (ABS) are securities issued on the basis of all assets, including foreign reliable loan securities, beneficiary securities, real estate, and bonds, and there are bonds, stocks, or beneficiary securities.

In other words, ABS securitizes assets held as collateral and aims to generate cash flows tied to assets by asset holders.

In addition, Mortgage-Backed Securities (MBS) is a type of asset-backed securities (ABS), where the bank that made the mortgage loan re-issues the bond as collateral with the mortgage to secure liquidity.

In addition, "Covered Bond" refers to bonds that issue high-quality assets such as loan bonds, government bonds, and real estate as collateral, and is similar to asset-backed securities (ABS).

Therefore, the Bank of Korea believes that it is desirable to use "asset-backed securities (MBS, covered bonds)" as "asset-backed securities (ABS, MBS, covered bonds" in professional terms from the next time.

2. government bonds

Government bonds are bonds issued by central banks in each country, and the most preferred government bonds are those issued by the U.S. Fed.

For reference, the size of government bonds owned by central banks in each country in February 2024, most recently disclosed by the U.S. Fed, is as follows (see attached U.S. Treasury Department).

The data showed the Bank of Korea had "US$119.2 billion" in government bonds at the end of February 2024.

Then, in the Bank of Korea's $370.61 billion (89.7%) foreign exchange reserves in April 2024, "$119.2 billion" is the U.S. Fed's government bonds, and the remaining "$251.41 billion" is securities such as government bonds, corporate bonds, and asset-backed securities.

However, we do not know in detail what and how much we have for securities such as "government bonds, corporate bonds, asset-backed securities" worth "$251.41 billion".

And my biggest concern is which country on the planet now has "$370.61 billion (89.7%) of its foreign exchange reserves.

And which country has corporate bonds, asset-backed securities, etc. as foreign exchange reserves of the central bank???

So I posted a post suggesting a parliamentary investigation into the Bank of Korea's foreign exchange reserves from 2019.

But no one is doing it.

However, it is said that the Bank of Korea's foreign exchange reserves are difficult to access because they are state secrets.

In the 22nd National Assembly, the relevant laws that can be accessed by the National Assembly, Korea