Hana Bank has issued a $100 million, five-year foreign-currency digital bond through Euroclear’s blockchain-based Digital Financial Market Infrastructure, or D-FMI, marking the first such issuance by a South Korean financial institution.
The transaction, completed on Sept. 18, also introduced same-day T+0 settlement to South Korea’s foreign-currency bond market. Traditional settlement typically takes three to five business days, according to reports on the issuance.
Blockchain cuts settlement time
The D-FMI platform uses distributed ledger technology to process key stages of a digital bond transaction. Hana Bank said the allocation of securities and movement of funds could occur directly on the distributed ledger, allowing settlement on the issuance date.
Euroclear describes D-FMI as infrastructure designed to support digital securities issuance and primary-market settlement using distributed ledger technology. Its digital securities service also connects with Euroclear Bank’s traditional settlement infrastructure for secondary-market activity.
That integration could reduce friction for institutional investors. Investors can continue using existing Euroclear accounts and trading systems rather than adopting an entirely separate settlement network.
Standard Chartered served as the sole coordinator and arranger for the transaction. The bank handled the bond’s structuring, issuance and distribution.
Digital bonds expand in capital markets
The transaction highlights the growing use of blockchain infrastructure beyond cryptocurrency markets. Digital bonds can place issuance, registration and settlement processes on distributed ledger networks, potentially reducing manual steps and settlement delays.
Hana Bank said the deal represents an effort to diversify funding channels while applying blockchain technology to traditional capital markets.
Euroclear has also expanded its D-FMI platform for other digital securities transactions, including digitally native notes. The infrastructure is designed to combine DLT-based issuance with access to established market and settlement systems.
The Hana Bank transaction therefore adds another example of financial institutions testing blockchain for conventional debt markets, with settlement speed and integration with existing infrastructure emerging as key considerations.
