S&P rates Export-Import Bank of Korea notes A

Standard & Poor's said it assigned an A senior unsecured foreign currency debt rating to the Export-Import Bank of Korea's (A/stable/A-1) proposed $1 billion equivalent global notes, which will be sold in two tranches: a fixed-rate dollar-denominated tranche maturing in February 2011 and a floating-rate euro-denominated tranche maturing in February 2013.

S&P said the ratings are based on the bank's public policy role and its direct support from the Korean government (A/stable/A-1). As the country's official export credit agency, the bank provides financial facilities in support of the government's export-led growth strategy and foreign trade and investment policies.

On the other hand, the agency said the ratings are constrained by the bank's low profitability. As a state-owned bank with a public policy mandate, Export-Import Bank of Korea is not primarily concerned with profit maximization and its net interest margin has been low historically - 0.89% in 2004 and 1.69% in 2003.

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