Kookmin Bank will on Monday begin a roadshow for what is set to be the first covered bond under a South Korean legislative framework completed last year. The news comes as elsewhere in Asia an amendment to Singapore’s framework is expected to be followed by that country’s first covered bond.

The Korean bank has mandated BNP Paribas, Citi and Société Générale for a 144A/Reg S dollar issue to be launched after a roadshow starting on Monday that will take in Hong Kong, Singapore, London, Frankfurt, New York, Chicago and Los Angeles and finish on 25 June.

Kookmin is the only one of South Korea’s banks to have issued a covered bond, selling a $1bn (Eu885m, Won1.11tr) deal in 2009. However, that was done on a contractual basis and the only other issuance from the country has been by Korea Housing Finance Corporation under legislation specific to the state institution – its issuance also pooled collateral from several Korean banks.

Citing shortcomings in existing issuance, the Korean government, Financial Services Commission and Financial Supervisory Service established a legislative framework that was completed last year.

In January Kookmin sought approval to apply a covered bond carve-out to the negative pledge clause of three outstanding unsecured bonds – something it had already done to its Global MTN programme – which was necessary for it to be able to proceed with higher ranking covered bond issuance.

The Monetary Authority of Singapore (MAS) last Thursday (4 June) published a response to feedback received on a consultation on amendments to the covered bond framework it has established in the country. The amendments to MAS Notice 648 clarified three main areas, notably giving banks more flexibility in how they can structure their covered bond programmes.

The move is seen as paving the way for the first covered bond issuance from the country, with market participants suggesting that an inaugural issue from DBS could emerge as early as before the summer holiday season.