ABS Issuance Drops in Q1 on Decline in Mortgage-Backed Securities

Seoul: The issuance of asset-based securities (ABSs) in South Korea fell markedly in the first quarter due to a sharp decline in the issuance of mortgage-backed securities (MBSs), data showed Monday. The ABSs issued last year came to 8.3 trillion won (US$5.77 billion) in the January-March period, down 43.8 percent, or 6.5 trillion won, from a year earlier. According to Yonhap News Agency, ABS refers to securities based on such assets as mortgages, auto loans, credit card receivables, and student loans. The decline came as MBSs issued by the Korea Housing Finance Corp. dropped 55 percent on-year to 2.65 trillion won in the first quarter amid the overall housing market slump. ABS issuance by financial companies fell 55.6 percent on-year to 3.06 trillion won in the first quarter, while that by non-financial firms surged 26.6 percent to come to 2.64 trillion won. As of end-March, the value of outstanding ABSs had stood at 251 trillion won, down 2.9 percent, or 7.4 trillion won, from a year before, the data show ed.