South Korea FX Fund Absorbs $20 Billion in SK Hynix Proceeds

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.

The Foreign Exchange Stabilization Fund, managed by the finance ministry and the Bank of Korea, made the purchases through over-the-counter transactions as SK Hynix repatriated its Wall Street proceeds to South Korea. The source declined to be named due to the sensitivity of the matter. SK Hynix, the finance ministry, and the central bank all declined to comment.

The purchases served two purposes. They helped stabilize foreign exchange market volatility and replenished dollar reserves that had been depleted by repeated interventions to defend the won. Market participants have speculated that the share of U.S. dollars in the stabilization fund has fallen sharply in recent months. The won has 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 percent in two months.

SK Hynix's July share sale was the largest U.S. offering by a foreign issuer. The memory chip maker said it would use the proceeds to finance new factories and equipment to meet surging AI chip demand.

The stabilization fund stood at 135.1 trillion won under an operational plan confirmed by the National Assembly last year. It is projected at around 106.5 trillion won under the government's latest budget proposal, unveiled on Tuesday. The transaction with SK Hynix shows how authorities are using large corporate capital flows to rebuild buffers without resorting to direct market intervention.