The sale of MBSs with a maturity of less than three years to be resumed from the 21st
- Date 2015-10-08
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The sale of MBSs with a maturity of less than three years to be resumed from the 21st
- Banks' purchase of Relief Loans MBSs completed -
Korea Housing Finance Corporation (HF, CEO Kim Jae-Chun) announced on October 8, 2015 that the purchase of
MBSs by banks offering Relief Loans has been completed.
On the 7th, the banks participated in the final round of bidding and bought KRW 31.4 trillion worth of MBSs
from HF through 'non-competitive bidding'*.
* The size of the loan sales to each loan-offering bank is determined by allocating MBSs into different tranches
in proportion to the amount of underlying assets transferred by the bank.
With the close of the initial rounds of bidding for the loan-offering banks, the remaining tranches of MBSs,
including short-term MBSs with maturities of one, two, and three years, will be opened up to general investors
through later rounds of bidding that start from October 21, 2015 (issuance scheduled on October 23, 2015).
An HF official said, “An increased MBS issuance volume thanks to favorable market conditions has helped us
complete our MBS sale to banks earlier than expected." He also said of the latter rounds of bidding,
"We expect strong interest by investors largely driven by pent-up demand for short-term MBSs following
the existing restrictions on the purchase of these short-term securities.”
During the following bidding process, HF will issue a total of six trillion won of MBSs for sale to general investors
until the end of this year under a biweekly issuance schedule.