More than one year after it was mandated, SG Asia has begun marketing a $60.75 million equipment lease and commercial loan-backed deal originated by Korean French Banking Corp. (Sogeko), a leading South Korean merchant bank partly owned by SG.

The issuer of the notes is a Korean SPC called Sogeko Funding Corporation. A Korean trustee, Chase Manhattan Bank, will issue two series of senior trust certificates which will be held by the International Finance Corp. (IFC) as the official holder of record. The IFC will purchase $20.25 million of certificates for its own account.

The transaction was rated Baa2 by Moody's Investors Service, a higher rating than its Baa3 sovereign rating for Korea. That was possible due to the IFC's preferred creditor status, which substantially mitigated transfer and convertibility risks, explained the agency.

The transaction will likely be placed with investors in New York and Hong Kong. Pricing was not set by press time, but initial price talk was 250 basis points over Libor, said a bank official in Seoul. "This whole process of issuing ABS took such a long time. We are very, very happy it is over," he commented.

Besides its long shelf life, the transaction is noteworthy for several reasons. It is the first Korean

securitization with 100% exposure to Korean entities, the main reason why its execution took so long, said a banker at SG Asia. More importantly, it is also

the first transaction in Asia supported by the IFC.

"The significance of this deal is that it shows how

the IFC umbrella program can be applied not just

in Korea, but elsewhere in Asia. Without it, it could have been done, but it would have been much

harder to get above the sovereign ceiling," the banker commented.

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