India First Edition

Summary of Moody’s Report on Asian Economy and growth

Exclusive of regional derivatives transactions, 1H08 estimated issuance in Asia (ex-Japan and Australia) increased to USD29.3 billion from USD27.9 billion in 1H07. The activity was driven mostly by:

? South Korea, which represented 60% of regional issuance and grew moderately by 3%. Domestic activity was stable. Cross-currency swap conditions have been favorable to the cross-border market which was more active than last year.

? India, which came in second with 30% of regional issuance. Issuance of single corporate loan CLO was up sharply, while issuance for ABS decreased slightly.

? China, which saw a second round of pilot securitizations by financial institutions; four transactions closed domestically, or 8% of regional issuance.

? Malaysia, which saw some activity as well as the closing of two public transactions, including a RM1.0 billion (USD306 million) Sukuk Ijarah transaction backed by four properties. But Cagamas, typically a significant issuer, was absent and issuance decreased.

However, 1H08 was quiet in several jurisdictions:

? Taiwan, in which only one CBO closed, in a very quiet market.

? Singapore, Hong Kong, Thailand, and Indonesia, which saw no public activity.

Asian cross-border issuance – excluding regional derivatives transactions –totalled USD2.8 billion and accounted for 9.7% of 1H08 cross-border and domestic issuance. All the off-shore transactions closed in Korea.  The regional derivatives market was quiet, except for balance-sheet transactions. Repackaged deals were done mostly privately.