S&P rates Korea Exchange Bank notes BBB+

Standard & Poor's said it assigned a BBB+ rating to Korea Exchange Bank's proposed dollar-denominated subordinated notes, which will be drawn down from the bank's $4 billion global medium-term program.

The proceeds are intended as lower tier II capital for the bank and will be direct, unsecured and subordinated to the claims of senior creditors, including depositors.

The proceeds will be used for general corporate purposes and refinancing of existing debt obligations, the agency said.

The differential between the BBB+ rating on the proposed notes and the A- issuer credit rating on the bank reflects the subordinated nature of the notes, S&P said.

The agency said it regards the proposed issuance as a hybrid instrument under the minimal equity content category and will not include it in its calculation of neither total adjusted capital nor adjusted total equity.

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