- Foreign institutional investors place order of USD 1.44 billion 

□ Korea Housing Finance Corporation (HF, CEO Kim Jae-Chun) announced on the 11th that it issued USD 500 million in offshore covered bonds at an all-time low interest rate with a maturity of five years*.

* Covered bonds are debt instruments issued by financial institutions and collateralized by assets held by the issuing institutions. Though similar to mortgage-backed securities (MBSs) in that they are secured by a pool of mortgage loans, covered bonds have dual recourse to both the issuing financial institution and the cover pool, thus making them less risky compared to similar asset-backed securities.

□ HF received orders of USD 1.44 billion, about three times the issuance volume, from foreign institutional investors on the 4th and 5th. HF finally set the coupon rate at 2.00%. The spread was set at 0.85%p above the five-year US treasury rate, making the lowest rate among the offshore covered bonds issued by HF.

< Comparison of Spreads of HF's Previous Covered Bonds >

□ Since 2010, HF has issued covered bonds denominated in the US dollars five times with mortgage loans as underlying assets.

□ An HF official said, "Continuous issuance of covered bonds has increased awareness of the corporation among foreign investors. We will issue covered bonds on a regular basis to raise funds for long-term, fixed-rate amortizing mortgage loans."