Korea Hoping for Investment Grade Rating From Moody"sThere is a strong possibility that Korea will receive an 'adequate for investment' grade from Moody's Investors Service in March 1999. Moody's announced on December 19 that it designated Korea as a 'review for possible upgrade' candidate which signifies a strong likelihood that its sovereign credit rating will be boosted.
Moody's analysts will visit Korea in January to evaluate Korea's credibility and determine whether or not a raise is in order in March. At present, Korea's credibility is 'Ba1' which is the highest level among 'not proper for investment' grades. If it can rise one grade to a 'Baa3', the lowest rung on the 'adequate for investment' ladder, its ongoing foreign exchange difficulties will be alleviated.
The Ministry of Finance and Economy (MOFE) revealed that Korean companies will be able to borrow money from foreign institutions more easily and at lower interest rates.
A source at MOFE expects that Standard & Poor's and Fitch IBCA will also upgrade Korea's credibility. Moody's explained that Korea's foreign exchange reserves have increased enough to repay IMF loans and its financial markets have stabilized.
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