South Korea's primary CBO program has hit problems before it has even got going. The program is intended to use funds committed by banks and insurance companies to purchase corporate bonds issued by second-tier firms and parcel them into CBOs for sale to both the government organized fund and other end investors.

It is part of the government's efforts to aid medium-sized firms who have been hit by a credit crunch and are unable to rollover their liabilities, leaving them dangerously exposed.

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