ID :
25121
Fri, 10/17/2008 - 14:06
Auther :
Shortlink :
http://m.oananews.org//node/25121
The shortlink copeid
Moody's keeps 'stable' outlook for S. Korean credit rating
ATTN: UPDATES with more details in para 2; ADDS with comments, information on
growth, current account from para 4)
SEOUL, Oct. 17 (Yonhap) -- Moody's Investors Service said Friday that it will
maintain its A2 "stable" outlook for South Korea's government-issued bonds based
on the country's economic resilience.
The ratings on local and foreign currency bonds are supported by the economic
restructuring seen over the past decade and the accompanying prudent fiscal
stance of the incumbent and recent administrations, Moody's said in a press
release.
Such a stance allows the strengthening of government finances and bolsters the
country's ability to absorb shocks, it said.
"The stable outlook is premised on the ability of the authorities to manage the
country's vulnerabilities to the global financial market crisis and avoid a deep
and sustained deterioration in relative credit metrics," said Tom Byrne, a senior
vice president at the Moody's Asia-Middle East regional credit office.
The updated report claimed that despite present risks and the relatively high
vulnerability of South Korean banks to the global credit crunch, the country is
much better positioned to weather the current crisis than it was during the
1997-98 Asian financial meltdown, which effectively paralyzed the country and
caused massive layoffs.
"While there is severe pressure on the ability of Korean banks, our assessment is
that the government still has the resources to provide dollar liquidity to
domestic banks, despite the ebbing in the Bank of Korea's foreign exchange assets
from an historical high of $264 billion earlier this year," he said.
The service forecast that Korea's GDP growth for next year will plummet to 2.2
percent year-on-year, the lowest since the 1997.
For 2008, it said growth may reach 4.0 percent, which is lower than the
government's mid-4 percent range target.
The rating service said the current account balance will reach rough parity in
2009 from US$12.0 billion in the red this year. Overall external debt is likely
to slip to $398.8 billion next year from $399.0 billion for this year.
growth, current account from para 4)
SEOUL, Oct. 17 (Yonhap) -- Moody's Investors Service said Friday that it will
maintain its A2 "stable" outlook for South Korea's government-issued bonds based
on the country's economic resilience.
The ratings on local and foreign currency bonds are supported by the economic
restructuring seen over the past decade and the accompanying prudent fiscal
stance of the incumbent and recent administrations, Moody's said in a press
release.
Such a stance allows the strengthening of government finances and bolsters the
country's ability to absorb shocks, it said.
"The stable outlook is premised on the ability of the authorities to manage the
country's vulnerabilities to the global financial market crisis and avoid a deep
and sustained deterioration in relative credit metrics," said Tom Byrne, a senior
vice president at the Moody's Asia-Middle East regional credit office.
The updated report claimed that despite present risks and the relatively high
vulnerability of South Korean banks to the global credit crunch, the country is
much better positioned to weather the current crisis than it was during the
1997-98 Asian financial meltdown, which effectively paralyzed the country and
caused massive layoffs.
"While there is severe pressure on the ability of Korean banks, our assessment is
that the government still has the resources to provide dollar liquidity to
domestic banks, despite the ebbing in the Bank of Korea's foreign exchange assets
from an historical high of $264 billion earlier this year," he said.
The service forecast that Korea's GDP growth for next year will plummet to 2.2
percent year-on-year, the lowest since the 1997.
For 2008, it said growth may reach 4.0 percent, which is lower than the
government's mid-4 percent range target.
The rating service said the current account balance will reach rough parity in
2009 from US$12.0 billion in the red this year. Overall external debt is likely
to slip to $398.8 billion next year from $399.0 billion for this year.
