The Korea Development Bank is rolling out a KRW312 billion ($300 million) securitization of fixed-rate bonds, Value Master 2008-1. The deal is fitted with a U.S. dollar-denominated credit facility provided by KDB, which will cover the full payment of the principal and interest of the notes. The underlying bonds were issued by a variety of Korean companies.
Value Master will issue into a swap agreement with KDB to hedge interest rate and cross-currency exposures. Established in 1954, the state-owned KDB provides long-term funds in the form of loans, bonds and equity investments with the aim of promoting the industrial development and economy of the country.
Fitch Ratings has rated the deal A+. Analysts with the agency said the rating is based entirely on the credit of KDB, which has a long-term foreign currency issuer default rating of A+. The bonds fall due in 2011.
South Korean firm NH Investment and Securities
Company is the securities trustee, seller and Korean arranger for the deal.
Merrill Lynch and KDB are the international arrangers. No officials from the parties involved could be immediately reached for comment.
