Foreign Credit Raters Okayed

Foreign-based credit rating firms will be allowed to do business in Korea from June 29, the Finance Ministry said Sunday. Bond raters such as Standard & Poor's and Moody's will then be able to conduct credit inquiries and provide collection services in Korea.

The ministry said that it would craft a revision of the Use and Protection of Credit Information Act that would enable international credit raters to enter the domestic market independently or through a joint venture with a domestic firm.

Also included in the revision, to protect investors, will be a measure that will restrict the evaluations of certain securities, such as nonguaranteed bonds and asset-backed securities, to firms that have government approval to be in the credit rating business. "Unqualified" credit rating companies are currently allowed to rate the securities.