Hanyang Securities Targets 1 Trillion Won in New ABL Deals

Hanyang Securities expects its asset-based lending arrangements to reach 1 trillion won this year. The firm is shifting away from traditional real estate project financing toward derivative-linked bond structures.

This strategic pivot allows the brokerage to generate revenue without increasing its own capital exposure. Recent deals for JB Woori Capital and Jeonbuk Bank already exceed 800 billion won in limits.

Derivative-Linked Bond Structures Drive Growth

The new product involves financial companies lending to special purpose vehicles. These vehicles then purchase derivative-linked bonds issued by Hanyang Securities.

Cash flows from the bonds repay the initial loans to the lenders. Hanyang Securities earns arranging fees rather than taking on direct credit risk.

According to Chosunbiz, financial firms view the yield-to-risk ratio favorably. This assessment has prompted active participation from banks and capital companies in the deals.

Expansion Into ETFs and Private Equity

Hanyang Securities entered the exchange-traded fund limited partner business at the end of last year. It has signed agreements with more than 60 ETFs so far.

The company plans to expand this number to 110 within the current year. It also completed registration as a general partner for institution-only private equity funds.

Capital Structure and Past Exposures

The firm issued 120 billion won in public corporate bonds this month. This marks the first such issuance since the company was founded.

Hanyang Securities still manages 84 billion won in exposure to the JoongAng Group. This amount represents roughly 13% of its equity capital as of March.