One-year term at 5% pre-tax annual rate

Per-person subscription limit of 1 billion won

Share and cash perks available for qualifying customers

An exterior view of the Kiwoom Securities headquarters. [Kiwoom Securities]
An exterior view of the Kiwoom Securities headquarters. [Kiwoom Securities]

Kiwoom Securities announced Monday it will offer a special promissory note product carrying a pre-tax annual interest rate of 5 percent with a one-year maturity, exclusively for customers opening their first-ever brokerage account.

The promotional rate is well above the company's earlier promissory note offerings. When Kiwoom first launched such products, the maximum rate stood in the mid-3 percent range before tax; the new special edition raises that to 5 percent.

The subscription limit is set at 1 billion won ($738,000) per person.

Kiwoom is also running a concurrent event offering shares and cash rewards. Customers who sign up for the event and maintain an average balance of at least 10 million won in the special promissory note over a three-month period through a non-face-to-face account will receive fractional shares in Samsung Electronics or SK hynix worth 50,000 won.

First-time customers who open a non-face-to-face comprehensive account can receive 50,000 won in cash through the existing account-opening event. Those who share the event with five acquaintances receive an additional 20,000 won in cash, with total additional benefits reaching up to 120,000 won.

Registration is required to participate in the event. Benefits may be restricted or the event may end early if individual eligibility conditions are not met or the allocated budget runs out ahead of schedule.

Kiwoom Securities received approval from the Financial Services Commission to issue promissory notes in November last year and has offered both demand-type and fixed-term products since December. In June, the company sold a special promissory note at an annual rate of 4.0 percent to mark the launch of its retirement pension business.

Unlike bank deposits and savings accounts, promissory notes are not covered under the Depositor Protection Act. Because repayment of principal and interest depends on the creditworthiness of the issuer — in this case Kiwoom Securities — investors should carefully consider the issuer's credit standing and ability to repay.

"We designed the interest rate and benefits together so that customers taking their first steps in investing can do so without feeling overwhelmed," a Kiwoom Securities official said.


moon@heraldcorp.com