S&P affirms South Korea’s long-term ratings at A+AA- with outlook stable

SINGAPORE – Ratings agency-Standard & Poor's has affirmed its foreign- and local-currency credit ratings on South Korea at 'A+/A-1' and ‘AA-/A-1+’, respectively. The outlook on the long-term ratings is stable, and S&P’s transfer and convertibility (T&C) assessment is 'AA'. The agency says its ratings reflect its favourable policy environment, sound fiscal position, and net external creditor position, while significant security risks and contingent liabilities offset these strengths.

“In our opinion, the chief weaknesses in Korea’s credit fundamentals are contingent liabilities and geopolitical risks on the Korean peninsula. Korea faces the prospects of bearing the uncertain, but likely heavy, costs of a reunification if the North Korea regime fails. Heightened public perceptions of the risks of an inter-Korean military conflict have also generated temporary volatility in Korea’s economy and financial system.”  www.standardandpoors.com (ATI).