ABS Issuance in Q1 Reaches 23 Trillion, Up 132% YoY... "Impact of Anshim Conversion Loan Supply"

[Asia Economy Reporter Park Jihwan] The issuance amount of asset-backed securities (ABS) in the first quarter of this year reached 22.7 trillion KRW, a sharp increase of 12.9 trillion KRW (131.9%) compared to the same period last year (9.8 trillion KRW). This was largely due to a significant rise in mortgage-backed securities (MBS) issued by the Korea Housing Finance Corporation, driven by the government's policy to expand financial services for low-income households.

According to the "2020 Q1 ABS Registration and Issuance Performance Analysis" released by the Financial Supervisory Service on the 29th, ABS issuance by public corporations and general companies increased compared to the same period last year, while financial companies saw a decrease.

The Korea Housing Finance Corporation, a public corporation, issued 17.9 trillion KRW worth of MBS, an increase of 13.1 trillion KRW (272.9%) compared to the same period last year. MBS are ABS issued by the Korea Housing Finance Corporation based on mortgage loans as underlying assets.

A Financial Supervisory Service official explained, "The launch of the low-income type safe conversion loan and the implementation of revised loan-to-deposit ratio regulations led to an increase in mortgage loans transferred by banks to the Housing Finance Corporation, thereby expanding MBS issuance."

ABS issuance by general companies, based on terminal installment payment claims and real estate project financing (PF), amounted to 2.7 trillion KRW, an increase of 800 billion KRW (42.1%) compared to the same period last year.

Financial companies issued 2.1 trillion KRW of ABS, a decrease of 1 trillion KRW (32.3%). Banks issued 400 billion KRW based on non-performing loans (NPL), credit finance companies issued 1.5 trillion KRW based on installment finance claims, and securities companies issued 200 billion KRW of bond collateralized bonds (P-CBO) based on corporate bonds issued by small and medium-sized enterprises.

Looking at ABS issuance by underlying securitized assets, ABS based on loan claims such as MBS and NPL amounted to 18.4 trillion KRW, an increase of 13 trillion KRW (240.7%) compared to the same period last year. Specifically, this includes 17.9 trillion KRW of MBS by the Korea Housing Finance Corporation, 400 billion KRW of NPL-based ABS, and 100 billion KRW of SOC loan claims.

ABS issuance based on sales receivables such as card claims and automobile installment claims recorded 4.1 trillion KRW, a decrease of 100 billion KRW (2.4%). This includes 1.2 trillion KRW of card claim-based ABS, 300 billion KRW of automobile installment claim-based ABS, 2.5 trillion KRW of corporate sales receivable-based ABS such as terminal installment payment claims, and 100 billion KRW of real estate PF-based ABS.

P-CBO issuance based on corporate bonds of small and medium-sized enterprises remained at 200 billion KRW, maintaining previous levels.

This content was produced with the assistance of AI translation services.