Government Downgrades Moody"s Evaluation

The Ministry of Finance and Economy(MOFE)on October 16 sent a letter of protest to Moody's, the American credit evaluation institute, which recently gave Korea's economy a negative rating outlook.
In the letter, the ministry's international financial director, Kim Woo Seok, commented, 'It is very regretful that they made the report on the basis of old data even before the International Monetary Fund crisis and we asked for a 'Supplimentary Report'.'
Moody's said that the Korean interest rate was still too high but the ministry refuted that assessment by saying the call interest rate was 7% which is lower than the pre-IMF bailout level.
The ministry also emphasized that major banks in Korea have received enough money from the government to fulfill the capital-adequacy ratio set by the Bank of International Settlement. The BIS capital-adequacy ratio of major banks stand at the 10-13% level. 'So the evaluation that 'Korean Banks are Technically Insolvent' by Moody's is exaggerated', added the ministry.
Moody's will send additional delegates to survey the Korean economic situation again early next month.