The issuance of asset-backed securities in South Korea nearly tripled in the first half of this year from a year ago due to a sharp rise in sales of government-led mortgage funds, the financial watchdog said Sunday.
  

A combined 48.2 trillion won ($42 billion) worth of ABS were issued in the January-June period, compared with 17.4 trillion won a year earlier, according to the Financial Supervisory Service.
  

ABS is derived from underlying assets such as car loans, home equity loans, credit card receivables and student loans.
  

The FSS said the steep increase came as the Korea Housing Finance Corp., the state-run mortgage agency, largely scaled up its mortage-backed securities, a type of ABS, as part of the government's policy to help borrowers convert their short-term floating-rate loans into longer, fixed-rate loans in order to tackle the galloping household credits.
  

The KHFC issued 37.1 trillion won worth of MBS over the six-month period, skyrocketing more than 10-fold from 3.5 trillion won a year earlier, while the Seoul government pumped a total of 40 trillion won into the program that started in late March.
  

ABS issuance by local financial firms fell 21.4 percent on-year to 7.3 trillion won, while non-financial companies issued 3.9 trillion won worth of ABS, down 13.2 percent over the cited period, the FSS said. (Yonhap)