Government-owned Korea Development Bank, the first domestic bank to offer credit derivatives in Korea (DW, 12/23), is looking to set up a credit derivatives market making operation within the next 12 months and offer its first synthetic CDO. H.G. Chung, head of financial engineering in Seoul, said the bank will look to establish a market-making operation and hire credit traders to complement the bank's credit structuring capabilities. He noted that it is too early to estimate the size of the operation.
KDB is structuring a synthetic CDO, which Chung said will be approximately USD100 million and will come to the market in the coming months. "Investors are keen," added Chung, noting growing interest for credit products in Korea.
