Q3 Registered ABS Issuance Falls 5.7% YoY to KRW 12.5 Trillion

The total issuance of asset-backed securities (ABS) declined as issuance of ABS backed by real estate project financing (PF) assets contracted.

According to the Financial Supervisory Service (FSS) on October 29, registered ABS issuance totaled KRW 12.5 trillion in the third quarter of 2026, down 5.7% (KRW 800 billion) from the same period a year earlier.

The decline in ABS backed by loan receivables led to a contraction in total ABS issuance. Issuance of ABS backed by loan receivables totaled KRW 7.5421 trillion, down 8.8% (KRW 730.8 billion) over the same period. In particular, issuance of ABS backed by real estate PF assets fell sharply, from KRW 1.1988 trillion to KRW 20 billion. An FSS official explained, "Issuance declined partly due to a base effect following the expansion of ABS issuance backed by real estate PF assets and guaranteed by the Korea Housing & Urban Guarantee Corporation (HUG)."

ABS backed by primary collateralized bond obligations (P-CBOs) also contributed to the decline in total ABS issuance. P-CBO-backed ABS issuance totaled KRW 857.4 billion in the third quarter of 2026, down 31.5% (KRW 394.8 billion) from the same period a year earlier.

ABS backed by trade receivables totaled KRW 4.1111 trillion, up 9.9% over the same period. By type of trade receivable, issuance backed by installment-financing receivables (from KRW 1.3047 trillion to KRW 100 billion) and corporate trade receivables (from KRW 1.177 trillion to KRW 961.5 billion) declined. However, a sharp increase in issuance backed by credit card receivables (from KRW 1.2593 trillion to KRW 3.0496 trillion) boosted total ABS issuance backed by trade receivables.

By asset holder, issuance by public entities increased, while issuance by financial companies and general corporations declined. Public entities increased their ABS issuance from KRW 5.1115 trillion in the third quarter of 2025 to KRW 5.7737 trillion in the third quarter of 2026.

Financial companies' issuance declined over the same period, from KRW 5.7789 trillion to KRW 5.7555 trillion. Issuance by banks (from KRW 1.666 trillion to KRW 1.4115 trillion) and securities firms (from KRW 1.2522 trillion to KRW 877.4 billion) contributed to the decrease in total issuance by financial companies. General corporations' issuance fell from KRW 2.3758 trillion to KRW 981.5 billion.

Meanwhile, the outstanding balance of registered ABS stood at KRW 246.6 trillion in the third quarter of 2026, up KRW 3.1 trillion from the same period a year earlier.

This content was produced with the assistance of AI translation services.