Lotte Card Issues $300 Million in Overseas ABS

[Financial News] Lotte Card said on the 18th that it had issued $300 million (approximately 404.1 billion won) in private-placement overseas asset-backed securities (ABS) backed by credit card receivables.
Mitsubishi UFJ Financial Group (MUFG) of Japan and Societe Generale of France participated in the transaction as investors. The securities have an average maturity of approximately three years and six months.
Lotte Card explained that it reduced its financial cost burden by securing competitive interest rate terms compared with raising funds in the domestic corporate bond market.
The company also entered into currency and interest rate swap agreements to manage the risks of exchange rate and interest rate fluctuations that could arise during the foreign-currency funding process. It said the agreements reduced uncertainty over funding costs caused by changes in market conditions.
Lotte Card plans to continue expanding its funding channels through domestic and overseas markets following the issuance of these overseas ABS. It will strengthen its funding competitiveness based on stable credit card receivables while pursuing proactive risk management tailored to market conditions.
A Lotte Card official said, "We were able to earn the trust of overseas investors based on our stable underlying assets and the financial management capabilities we have accumulated. We will continue to diversify our funding channels and pursue proactive risk management to improve our medium- to long-term profitability and strengthen our financial structure."
[email protected] Hong Ye-ji Reporter