SEOUL, July 31 (Xinhua) -- South Korea's issuance of mortgage-backed securities (MBS) nearly tripled in the first half of this year as the government increased the supply of low-rate loans for ordinary people, financial watchdog data showed Friday.
The sale of MBS, issued by the state-run Korea Housing Finance Corp. to securitize home-backed debts owed by households, reached 28.7 trillion won (24.1 billion U.S. dollars) in the January-June period, up from 10.4 trillion won (8.7 billion U.S. dollars) in the same period of last year, according to the Financial Supervisory Service (FSS).
The MBS issuance rose sharply as the government offered more low-rate mortgage loans for ordinary people from the third quarter of last year.
The country's central bank slashed its target rate by 25 basis points to an all-time low of 0.50 percent in May, after cutting the rate by 50 basis points in March. The rate cut lowered debt-servicing burden for households.
The issuance of asset-backed securities (ABS), including MBS, amounted to 43.6 trillion won (36.6 billion U.S. dollars) in the first half, almost doubling 22 trillion won (18.5 billion U.S. dollars) in the same period of last year.
The ABS issuance by industrial companies was 5.9 trillion won (5 billion U.S. dollars), while the ABS sale by financial firms amounted to 9 trillion won (7.6 billion U.S. dollars).
The primary collateralized bond obligations (P-CBO), issued by securities firms to securitize corporate bonds, came to 2.9 trillion won (2.4 billion U.S. dollars) in the first half, more than doubling compared to a year earlier. Enditem
