Korea Housing Finance Corporation drove a 26.5% year-on-year increase in registered asset-backed securities (ABS) issuance during the first half, according to data released by the Financial Supervisory Service on the 29th. The corporation's mortgage-backed securities (MBS) issuance surged 6.6 trillion won (123.1%) compared to the same period last year, while card companies increased card receivables-based ABS issuance by 1.3 trillion won (14.0%). The growth reflects expanded Bogeumjari loan supply and regulatory changes enabling the Credit Guarantee Fund to directly issue ABS through self-trust accounts for the first time.
Registered ABS Issuance Reaches 26.6 Trillion Won in First Half
Total registered ABS issuance for the first half reached 26.6 trillion won, up 5.6 trillion won from 21 trillion won in the same period last year, according to the Financial Supervisory Service report. Outstanding registered ABS balances stood at 246.5 trillion won as of end-June, increasing 3.4 trillion won (1.4%) from 243.1 trillion won at end-June last year. Public corporations including Korea Housing Finance Corporation and the Credit Guarantee Fund, alongside specialized credit finance companies, drove the expansion.
Korea Housing Finance Corporation MBS Issuance Increases 123.1%
Korea Housing Finance Corporation's MBS issuance increased 6.6 trillion won (123.1%) compared to the first half of last year. The expansion correlates with increased Bogeumjari loan supply, which reached approximately 11.3 trillion won in sales through May, exceeding the entire first-half total of 8 trillion won from last year, according to the Housing Finance Statistics System. Card companies' card receivables-based ABS issuance rose 1.3 trillion won (14.0%) during the same period.
Card Receivables and Loan-Based ABS Show Divergent Trends
Receivables-based ABS issuance totaled 7 trillion won, up 1.9 trillion won (37.7%) year-on-year, driven by increases in card receivables and installment finance receivables-based securities. Loan-based ABS showed mixed performance: real estate project financing (PF)-based ABS issuance decreased 2.3 trillion won (36.8%) to approximately 4 trillion won, while non-performing loan (NPL)-based ABS fell 100 billion won (3.5%). However, the 6.3 trillion won (118.1%) increase in MBS issuance expanded overall loan-based ABS volume.
Credit Guarantee Fund Issues First ABS Under New Regulation
The Credit Guarantee Fund issued 269 billion won in ABS for the first time following an October amendment to the Credit Guarantee Fund Act. The regulatory change allows the fund to directly issue beneficiary certificates using self-trust accounts. This inaugural issuance contributed to first-half ABS growth figures.
FAQ
What was the total registered ABS issuance in the first half?
The Financial Supervisory Service reported total registered ABS issuance of 26.6 trillion won for the first half, representing a 5.6 trillion won (26.5%) increase from 21 trillion won in the same period last year.
Why did Korea Housing Finance Corporation's MBS issuance increase 123.1%?
The 6.6 trillion won increase in MBS issuance correlates with expanded Bogeumjari loan supply, which reached 11.3 trillion won in sales through May according to the Housing Finance Statistics System, exceeding last year's entire first-half total of 8 trillion won.
How did the Credit Guarantee Fund regulatory change affect ABS issuance?
Following an October amendment to the Credit Guarantee Fund Act, the fund issued 269 billion won in ABS for the first time using self-trust accounts to directly issue beneficiary certificates, contributing to overall first-half growth.
