Thailand's dominant mortgage originator, Government Housing Bank, is reportedly turning its attention to Korean investors for a THB30 billion ($789 million) proposed securitization scheme.

According to local media, GHB is lining up Standard Chartered First Bank - Korea's benchmark cross-border MBS issuer - to lead manage the program, possibly for sale in the domestic Korean market. Presumably, GHB wants to use Standard Chartered's (SCFB's parent) ex-Japan Asia securitization team for structuring.

GHB says it will issue a first deal from the program in 2007, and ultimately wants to raise THB20 billion from offshore investors and the remainder from Thai accounts.

Korean link

Market watchers are taking the Korean link with a large dose of salt, however. Earlier this year, GHB said it had held discussions with Middle Eastern banks to sell MBS paper, hoping to tap into the huge demand for investment products in the region.

The bank fell silent on the story not long afterwards, however. Whether Korean investors would find a Thai MBS offering appealing is also questionable.

If GHB is to do a successful cross-border offering, bankers believe it will have to bring in a monoline to wrap the bonds. GHB has had difficulties with non-performing loans and it is believed an unwrapped deal would be a tough sell to foreign accounts.

(c) 2006 Asset Securitization Report and SourceMedia, Inc. All Rights Reserved.

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