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Photo = Homeplus |
[Alpha Biz= Kim Jisun] Tensions are escalating between Homeplus and Shin Young Securities over issues surrounding the company’s Asset-Backed Short-Term Bonds (ABSTBs) issued based on credit card receivables.
According to industry sources, on May 28, Homeplus filed a criminal complaint with the prosecution against Geum Jeong-ho, CEO of Shin Young Securities, accusing him of credit defamation. Under Korean law, credit defamation occurs when a person damages another’s credit through false information or deceptive conduct.
Shin Young Securities has been the lead manager for Homeplus’ issuance of commercial paper (CP), electronic short-term bonds, and ABSTBs since August 2022. Homeplus is reportedly targeting remarks made by CEO Geum during an emergency parliamentary session of the National Policy Committee in March.
At the time, Geum stated, “A downgrade in credit rating doesn’t automatically reduce demand for short-term bonds,” and added, “It’s not logical to claim that a company filed for rehabilitation just because it couldn’t raise funds after a downgrade.”
Shin Young Securities and ABSTB investors claim that Homeplus had prior knowledge of an impending credit rating downgrade and was planning to file for corporate rehabilitation on March 4, but withheld this information. They allege that Homeplus continued issuing ABSTBs up until February 25—just a week before filing—causing significant investor losses. Prosecutors are currently investigating these claims.
However, Homeplus argues that it had no involvement in the issuance of the ABSTBs and asserts that the focus should instead be on whether Shin Young Securities, despite knowing about the downgrade, engaged in mis-selling by continuing to sell ABSTBs to investors.
AlphaBIZ Kim Jisun(stockmk2020@alphabiz.co.kr)
