Asia's securitisation market in its infancy

IT'S still early days for Asia's asset-backed securities (ABS) market, even as banks in Singapore are set to issue covered bonds, said industry players at a conference by the Asia Securities Industry and Financial Markets Association on Wednesday.

"We still see a lot of work ahead," said Khoo Boo Hock, vice-president, operations, at Credit Guarantee & Investment Facility, which offers credit guarantees for local currency denominated bonds issued by investment grade companies in Asean. "There are some markets where the bond market is new."

Banks and other companies package assets such as mortgages or trade receivables into securities that yield a cash payment reflecting the credit quality of the underlying assets, which are then sold to investors.