A $500m five year covered bond issue for Kookmin Bank (KB) last week attracted diverse orders in a challenging market, according to a senior representative at the South Korean issuer, who said the bank plans to issue one or two further covered bonds this year.

Kookmin sold its second legislative benchmark covered bond, a $500m (Eu460m, Won601tr) five year 144A issue, last Thursday. Kookmin had in October sold the first covered bond to be launched under dedicated South Korean legislation, a $500m five year issue. Kookmin had previously issued on a contractual basis.

Leads ANZ, BNP Paribas, Commerzbank and DBS opened books on Thursday morning, after the Asia open, with initial price thoughts of the 100bp over mid-swaps area, before moving to guidance of the 95bp-97bp area, will price within range, after the US open. The spread was then set at 95bp, with the book closing at $800m.

“Given the recent market turmoil in China and sliding oil prices, KB had to push forward the deal amid volatile market conditions,” said the Kookmin representative. “However, KB sees the deal as relatively successful in that KB could attract many Asian investors, as well as diversified global investors as a result of increased investor relations efforts since the first offering in October 2015.”

Almost half of the orders came from Asian accounts, according to a syndicate official at one of the leads, with European accounts taking around a third.

Some market participants had expected the deal to arrive earlier last month, after Kookmin announced a mandate, and leads ANZ, BNP Paribas, Commerzbank and DBS began taking IOIs for the new issue on Monday of last week (25 January).

“Within the issuance window available, KB tried to narrow down the timing of issuance with the uncertainty being minimised, which came down to post an FOMC meeting held on 27 January – since early in the week the market was volatile and KB thought it would be better off to wait until the market was lulled again,” said the Kookmin representative.

The representative added that Kookmin plans to issue a further one or two covered bonds in 2016.

“We believe KB has just embarked on its long journey to becoming a frequent covered bond issuer in a global market,” he said. “KB will endeavour to provide liquidity of its covered bonds through frequent offerings going forward.”