By Seunggyu Lim
SEOUL, Sept 2 (Reuters) - South Korean foreign exchange authorities bought about $20 billion in U.S. dollars that SK Hynix sold after its $26.5 billion American depositary receipt listing in July, a source with direct knowledge of the matter said on Wednesday.
The Foreign Exchange Stabilization Fund, managed by the nation's finance ministry and the Bank of Korea, made the purchases through over-the-counter transactions as SK Hynix repatriated U.S. dollars to South Korea, the source
said, declining to be named due to the sensitivity of the matter.
While it was widely known that the South Korean chipmaker would repatriate the dollars it raised on Wall Street, Reuters is reporting the ultimate buyer of the bulk of the repatriated funds for the first time.
SK Hynix, the finance ministry and the BOK declined to comment.
The move is different from the kinds of FX interventions that authorities have historically made, and it also seeks to stabilize FX market volatility while replenishing the country's depleted forex reserves.
South Korea does not officially disclose the exact asset breakdown or current size of its Foreign Exchange Stabilization Fund, a sovereign pool composed exclusively of U.S. dollars and Korean won.
However, market participants and macroeconomists have speculated that the proportion of greenbacks within the fund has severely declined in recent months, after the central bank's aggressive and persistent FX interventions to defend the local currency.
The won has recently staged a dramatic recovery after ranking among Asia's worst-performing currencies in 2025. The dollar-won rate, which hovered near a 17-year low of 1,550 in late June, has gained more than 12% in two months.
SK Hynix's July share sale was the largest U.S. offering by a foreign issuer, and the memory chip maker said it planned to use the proceeds to finance new factories and equipment to meet surging AI chip demand.
The Foreign Exchange Stabilization Fund, which stood at 135.1 trillion won ($98.7 billion) under an operational plan confirmed by the National Assembly last year, is projected at around 106.5 trillion won under the government's budget proposal, which was unveiled on Tuesday.
(Reporting by Seunggyu Lim, Writing and additional reporting by Cynthia Kim; Editing by Ed Davies, Brenda Goh and Thomas Derpinghaus)
