S&P Assigns AA Credit Rating to South Korean Government Bonds

[Image source=AP Yonhap News]

[Asia Economy Reporter Oh Hyung-gil] International credit rating agency Standard & Poor's (S&P) announced on the 7th that it has assigned an 'AA' long-term foreign currency bond rating to the senior unsecured bonds that the Korean government is preparing to issue.

In a press release on the same day, S&P stated, "These bonds are direct, general, unconditional, senior obligations of the Korean government and are treated equally with the government's other senior unsecured bonds."

The credit rating AA is the same as the current sovereign credit rating of Korea assigned by S&P.

Earlier, the government included plans to issue government bonds worth 10.3 trillion won in the first supplementary budget, 3.4 trillion won in the second supplementary budget, and 23.8 trillion won in the third supplementary budget this year to respond to the novel coronavirus disease (COVID-19).

Recently, the government has formalized the preparation of the fourth supplementary budget and set a policy to finance the entire amount through deficit bond issuance.

Previously, in April, S&P maintained Korea's long-term sovereign credit rating at 'AA' and short-term sovereign credit rating at 'A-1+'.

S&P has maintained this rating since upgrading Korea's sovereign credit rating from 'AA-' to 'AA' in August 2016. The AA rating is the third highest investment grade.

This content was produced with the assistance of AI translation services.