Lotte Card issues $300M in overseas ABS to diversify funding
What's the deal? Lotte CardDealroom has a profile for this one. Try Dealroom → has issued $300 million in overseas asset-backed securities (ABS), backed by credit card receivables, to broaden its funding channels. Mitsubishi UFJ Financial Group (MUFG)Dealroom has a profile for this one. Try Dealroom → and Société Générale subscribed to the privately placed notes, which carry an average maturity of 3.5 years.
Why now? The South Korean card issuer said it secured funding at competitive rates versus domestic corporate bonds, helping lower financing costs. It hedged the deal with currency and interest-rate swaps to limit foreign-exchange and interest-rate risks.
What's the endgame? The company is building out overseas financing options to reduce reliance on the domestic bond market. "We will continue to diversify our funding channels and actively manage risks to improve long-term profitability and strengthen our financial structure," a Lotte Card official said.
The signal: A $300 million issuance is a modest raise by global standards, but the involvement of MUFG and Société Générale points to steady foreign appetite for Korean credit card receivables — and to issuers looking abroad when overseas rates undercut home-market borrowing.
Read more: n.news.naver.com
Image credit: Brett L.
