Bangkok--6 Sep--Moody's Investors Moody's Investors Service says estimated issuance in Asia's structured finance market in 1H07 -- exclusive of Japan and Australia as well as regional cross-border derivatives -- increased to USD29.1 billion from USD25.5 in 1H06 with more than 300 transactions. At the same time, if derivatives are included, the total surpasses USD30 billion. "The growth was mostly driven by increased activity in four markets, specifically India, South Korea, Singapore and Malaysia," says Dominique Gribot-Carroz, a Moody's AVP, based in Hong Kong, and author of a new report from the rating agency and its affiliates -- CCXI, ICRA and KIS -- which reviews 1H07 and looks at the outlook for 2H07. "For 2H07, Moody's expects India, Singapore and Malaysia to keep growing and potential deals in Hong Kong and Indonesia," says Gribot-Carroz, adding, "The extent of growth in Korea and Taiwan is more uncertain, given the slowdown in real estate issuance Korea and the uncertain outlooks for Taiwanese CBO. " "In China, the level of domestic issuance will depend on official approvals and debt capital market conditions, and we could also see new cross-border securitizations from the Mainland, most likely CMBS," says Gribot-Carroz. "Growth in China will play a key role for Asian issuance in 2H07 and beyond." During 1H07, in India, there was vigorous growth due to ABS issuance, which increased by 90% compared to 1H06, while Korea still represented close to 65% of regional issuance and grew moderately. In Singapore, property-related securitizations more than doubled, while in Malaysia 1H07 issuance exceeded USD1 billion and Cagamas returned to the market with its second Islamic RMBS. The first Malaysian synthetic CLO was also launched in May. With regional derivative deals, single tranche synthetic arbitrage structures continued to enjoy popularity among Asian investors. "Looking ahead, Asia (ex-Japan and Australia) may see some innovative derivative deals emerging in the coming months, despite some signs of uncertainty in the region's markets," says Gribot-Carroz, adding, "Already in August, Moody's had rated the first constant proportion debt obligation or CPDO structured in Asia." The Asia-wide report is being released in conjunction with separate reports for India and Korea, a combined report for China, Hong Kong and Taiwan, another combined report for Singapore, Malaysia, Indonesia and Thailand, and another on regional derivatives.