Cash services – South Korea – KGBs and MSBs
Cash payments
Incoming funds
Incoming KRW (other than income proceeds resulting from Korean government bond and MSB positions held with Clearstream Banking) must always be pre-advised. Beneficial owners are required to insert their IRC number (IRC number that ranges from 1-digit to 5-digits) or LEI (20-character alpha-numeric code) into field :50: of their Swift MT210 message.
Example when it is an IRC:
:50:12345
Example when it is a LEI:
:50:123456AB789CD1EFH0133
Note: Clearstream Banking clients who already have an IRC number must continue to use this number and cannot substitute it with the LEI or any other identification method.
Additionally, for funds to be allocated to beneficial owners’ Clearstream Banking account in time, beneficial owners must request their local cash correspondent bank to include their Clearstream Banking account number (5-digit number) in the narrative field of their payment instruction. Failure to do so will lead to late credit of funds in the beneficial owners’ Clearstream Banking account.
Withdrawal of funds
Beneficial owners may transfer funds between their own KRW account, held with a local cash correspondent bank, and the KRW account of Clearstream Banking, held at HSBC Seoul Branch. For such withdrawals of KRW from Clearstream Banking, beneficial owners are required to insert their IRC number (IRC number that ranges from 1-digit to 5-digits) or LEI (20-character alpha-numeric code) into field :72: of the MT202, :70: of the MT103 or narrative field of their cash withdrawal instruction.
Example when it is an IRC:
MT202
:72:12345
MT103
:70:12345
Example when it is a LEI:
MT202
:72:123456AB789CD1EFH01
MT103
:70:123456AB789CD1EFH01
Note i: Clearstream Banking clients who already have an IRC number must continue to use this number and cannot substitute it with the LEI or any other identification method.
Note ii: Decimals are not allowed in KRW for cash transfers.
Note iii: Book transfers in KRW will not be permitted in Clearstream Banking. Similarly, internal settlement against KRW will not be permitted.
Overdrafts
Overdrafts in KRW are currently not supported.
Foreign exchange
Foreign exchange services for KRW are available to clients, only in relation to Clearstream Banking’s direct omnibus Korean link for Korean government bonds and MSBs. For details of Clearstream Banking’s foreign exchange services, please refer to the CBL Client Handbook.
Note: Clients settling Korean listed equities and Korean listed corporate bonds via Clearstream Banking’s depository, The Hongkong and Shanghai Banking Corporation Limited, Seoul Branch (depository code: 1K) must continue to follow the funding/repatriation process indicated in the section “Automatic conversion of KRW purchase and sale proceeds” at Settlement Services – South Korea – Equities and corporate bonds.
Bank of Korea (BOK) Reserve Day
BOK Reserve Day occurs on the second Wednesday of each month and clients should take note that cash transfer activities will be limited in South Korea on these days. It is therefore strongly advised for clients to send any cash instructions on the day prior to the BOK Reserve Day. Cash instructions sent on BOK Reserve Day itself will be handled on a best efforts basis.