Moody's affirms Woori Bank after re-evaluation

Prompted by a sharp spike in Woori Bank's problem assets during the third quarter 2010, its asset quality and capital were re-evaluated prior to Moody's affirmation.

According to Moody's, “As of September 2010, the non-performing loan ratio had risen to 3.85% from 1.60% at end-2009, while precautionary & below loan ratio had increased to 6.80% from 4.44%. Woori Bank's weak asset quality had been anticipated and is reflected in the one-notch differential between its BCA and the Baa1 BCA of the other three major Korean banks -- Kookmin Bank (C-/A1), Shinhan Bank (C-/A1) and Hana Bank (C-/A1).”

Including Moody's estimates of additional credit costs, actual credit costs for the last seven quarters are approaching the estimated loss in its worst-case scenario analysis. As a result, Moody's said, Woori Bank's performance has pushed its financial metrics to the bottom of its BCA rating band.

Woori Bank's ratings are:

Foreign currency senior debt of A1

Foreign currency subordinated debt of A2

Foreign currency junior subordinated of A3

Foreign currency Hybrid Tier 1 debt of Ba2

Foreign currency long-term deposit of A1

Foreign currency short-term deposit of Prime-1

Bank financial strength of C-

Baseline credit assessment of Baa2

All the ratings carry a stable outlook.