There have still only been a small number of securitization issues in Asian markets outside Japan, but the trend has changed since the Asian currency crisis in 1997. Securitization is now regarded as an effective tool as banks and companies are increasingly required to strengthen their balance sheets, to boost their capital ratios or lower their gearing ratios.

From a long-term point of view, R&I believes the development of a securitization market will have a positive impact on sovereign, corporate and bank ratings in Asia. Through securitization, banks and companies will more easily be able to adjust their balance sheets by lowering their gearing and will also be able to achieve more efficient management, as seen in South Korea and Hong Kong recently.

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