The Korea Housing Finance Corporation’s issuance of US$500,000,000 Covered Bonds due 2021 was the fifth legislative covered bond issuance in Korea. The KHFC’s covered bonds offer an efficient means of financing for originators of residential mortgage loans.  Although new legislation of the Covered Bond Act in Korea has enabled Korean banks to issue legislative covered bonds, many Korean banks are still ill-prepared to issue covered bonds based on home mortgage loans due to the rigorous eligibility criteria applicable to home mortgage loans. KHFC’s issuance of the covered bonds is expected to energize other lenders to pursue more issuance of home-mortgage-loan backed bonds. 

As the arrangers’ counsel, Shin & Kim took a leading role in resolving legal issues arising from the issuance and assisted the client in negotiating with the issuer and other parties to the transaction.  Our unmatched experience in covered bonds reaffirms that we are the go-to firm on these types of issuances.