SEOUL– South Korean institutions’ investment in foreign securities shrank 5 percent in the third quarter due to estimated losses from their bond and stock holdings, central bank data showed Friday.

The outstanding value of foreign securities held by local institutional investors stood at US$354.93 billion as of end-September, down $18.69 billion from three months earlier, according to the data from the Bank of Korea (BOK).

The decline is blamed on losses caused by setbacks in global bond and stock markets affected by fast rate hikes in major countries to fight inflation.

Foreign securities include stocks, bonds and “Korean paper,” which refers to foreign currency-denominated securities issued by the South Korean government, banks and companies in overseas markets.

Local institutions’ investment in foreign stocks shrank $10.4 billion on-quarter, and the value of their foreign bond holdings contracted $6.59 billion.

Their investment in Korean paper also declined $1.7 billion over the cited period, according to the data.

Source: Yonhap News Agency