Korea's first transaction with a foreign bank as back-up servicer has closed, as JPMorgan Chase announced it signed the Samsung Card Co. Ltd. credit card securitization this week. Arranged by Merrill Lynch, the Samsung deal is noteworthy as being the first cross-border credit card backed deal in Korea this year.
In alliance with Korea First Bank, its local partner, JPMorgan becomes the first foreign bank to provide back-up servicing in Korea, according to the company. "The standardized documentation and servicing standards that the alliance creates will allow speedier execution, greater risk mitigation and quicker time to market for asset-backed and mortgage-backed transactions," the company stated in its release.
Utilizing a back-up servicer provides enhancement through mitigating servicer risk. JPMorgan Chase Bank, N.A., a global provider of fiduciary services in the structured finance market, is rated 'Aa2' by Moody's Investors Service. Korea First Bank, focused on mortgage and credit card loans in Korea, is rated 'Baa3' by Moody's.
"In Korea, our alliance with Korean First Bank provides not only a greater back up servicer provider choice but all the benefits of a highly rated global service provider in the structured finance market," said Ben Lumley-Smith, JPMorgan's senior vice president, ITS Asia business manager, Global Debt Services, in a release. "Forging the business alliance with Korea First Bank brings the same level of confidence and choice to the market as the alliance we forged with Credit Saison in Japan." Lumley-Smith added.