Shin Dong-bin, chairman of Lotte Group, South Korea's sixth-largest conglomerate, extended a 90 billion won stock-backed loan on the 28th of last month, with the interest rate rising from 3.86% to 4.56%. The rate increase reflects rising market interest rates, as the 91-day certificate of deposit (CD) rate climbed from 2.56% at the end of June last year to 2.92%. Shin holds total loans of 242.9 billion won from Korea Securities Finance, secured by 11.762 million shares of Lotte Holdings and 2.5549 million shares of Lotte Shopping, all with a 110% collateral maintenance ratio.
Shin Dong-bin Extends 90 Billion Won Loan with Rate Increase
Shin Dong-bin extended a 90 billion won loan on the 28th of last month. The loan contract period was extended from January 24 to June 28. The interest rate on this loan increased from 3.86% to 4.56%.
Total Loans Reach 242.9 Billion Won Backed by Lotte Stocks
Shin Dong-bin borrowed a total of 242.9 billion won from Korea Securities Finance. The loans are secured by 11.762 million shares of Lotte Holdings and 2.5549 million shares of Lotte Shopping. The loan amounts are divided into three tranches: 76.9 billion won at 3.83%, 90 billion won at 4.56%, and 76 billion won at 4.13%. All loans maintain a 110% collateral maintenance ratio.
Interest Rates Tied to CD 91-Day Market Rate
Loan interest rates are determined by adding a spread to the 91-day certificate of deposit (CD) rate, according to Korea Securities Finance's stock-backed loan product description. The CD 91-day rate rose from 2.56% at the end of June last year to 2.92%.
Historical Rate Fluctuations Track Market Changes
Shin Dong-bin's stock-backed loan interest rates have fluctuated with market rates. When he extended a 90 billion won loan in June 2024, the rate was 4.76%. When he extended the same loan again in June 2025, the rate dropped to 3.86%. This decline corresponded to the CD 91-day rate falling from 3.60% at the end of June 2024 to 2.56% at the end of June 2025.
Collateral Maintenance Ratio Set at 110%
The collateral maintenance ratio is the minimum percentage that the value of collateral stocks must maintain relative to the loan amount. If this ratio is not met, additional collateral may be required, or forced selling may occur. Forced selling happens when the value of collateral stocks falls and the maintenance ratio drops below the threshold, prompting the financial institution to dispose of the collateral stocks. All of Shin Dong-bin's loans maintain a 110% collateral maintenance ratio.
Loan Balance Adjustments Over Time
Shin Dong-bin took out a new 14 billion won stock-backed loan at the end of July last year and repaid it in April this year. As of the most recent data, his total stock-backed loan balance stands at 242.9 billion won.
FAQ
What loan did Shin Dong-bin extend on the 28th of last month?
Shin Dong-bin extended a 90 billion won stock-backed loan on the 28th of last month. The loan contract period was extended from January 24 to June 28, and the interest rate increased from 3.86% to 4.56%.
Why did Shin Dong-bin's loan interest rate increase to 4.56%?
The interest rate increased because market interest rates rose. The 91-day certificate of deposit (CD) rate climbed from 2.56% at the end of June last year to 2.92%. Loan rates are determined by adding a spread to the CD 91-day rate.
How much total stock-backed debt does Shin Dong-bin hold?
Shin Dong-bin holds total stock-backed loans of 242.9 billion won from Korea Securities Finance, secured by 11.762 million shares of Lotte Holdings and 2.5549 million shares of Lotte Shopping.
