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Rating Action:

Moody's assigns Counterparty Risk Ratings to 16 banks and Korea Securities Finance Corporation

28 Jun 2018

Hong Kong, June 28, 2018 -- Moody's Investors Service ("Moody's") has today assigned Counterparty Risk Ratings (CRRs) to 16 banks in Korea and their branches as applicable.

The 16 banks affected are: 1) Busan Bank, 2) Citibank Korea Inc, 3) Daegu Bank, Ltd., 4) Industrial Bank of Korea, 5) Jeju Bank, 6) Jeonbuk Bank, 7) KEB Hana Bank, 8) Kookmin Bank, 9) Korea Development Bank (KDB), 10) Kwangju Bank Ltd, 11) Kyongnam Bank, 12) NongHyup Bank, 13) Shinhan Bank, 14) Standard Chartered Bank Korea Limited, 15) Suhyup Bank and 16) Woori Bank.

Moody's has also assigned CRR to Korea Securities Finance Corporation (KSFC).

Moody's has also assigned long-term Counterparty Risk Assessment (CRA) of Aa2(cr) to KDB's New York Branch and affirmed its short-term CRA of P-1(cr); and assigned short-term CRA of P-1(cr) to KDB's Singapore Branch and affirmed its long-term CRA of Aa2(cr).

Moody's Counterparty Risk Ratings are opinions of the ability of entities to honour the uncollateralized portion of non-debt counterparty financial liabilities (CRR liabilities) and also reflect the expected financial losses in the event such liabilities are not honoured. CRR liabilities typically relate to transactions with unrelated parties. Examples of CRR liabilities include the uncollateralized portion of payables arising from derivatives transactions and the uncollateralized portion of liabilities under sale and repurchase agreements. CRRs are not applicable to funding commitments or other obligations associated with covered bonds, letters of credit, guarantees, servicer and trustee obligations, and other similar obligations that arise from a bank performing its essential operating functions.

RATINGS RATIONALE

The CRRs assigned to the 16 Korean banks and KSFC are in line with the Counterparty Risk Assessments (CR Assessment) already assigned.

Because Moody's considers that Korea does not have an operational resolution regime, in assigning CRRs to the Korean banks and KSFC subject to this rating action, the rating agency applies its basic Loss Given Failure (LGF) approach. Moody's basic LGF analysis positions CRRs in line with the bank's and KSFC's CRA, one notch above their adjusted Baseline Credit Assessments (BCA).

Furthermore, the CRR also incorporates between one to eight notches of uplift from government support based on Moody's assessment of government support for the 16 banks and KSFC in times of need, based on their systemic importance to Korea. The uplifts are in line with those applied to their CRA.

For KSFC, although it is a key corporation in the securities industry, we assigned CRR and CRA because we use the Banks methodology to rate KSFC in light of its operation and balance-sheet structure which are similar to that of banks.

For KDB, in line with KDB's long- and short-term counterparty risk assessments (CRAs), Moody's has assigned long-term CRA of Aa2(cr) to KDB's New York Branch and short-term CRA of P-1(cr) to KDB's Singapore Branch.

OUTLOOK

CRR do not carry outlooks.

FACTORS THAT COULD LEAD TO AN UPGRADE/DOWNGRADE

BUSAN BANK -- WHAT COULD CHANGE THE RATING UP

Busan Bank's ratings could be upgraded if its BCA is raised over the next 12-18 months.

The bank's BCA could be upgraded if (1) it improves its asset quality while maintaining its high profitability and capitalization, with annual net income/tangible assets in excess of 1.0% on a sustained basis; or (2) its problem loans/total loans improves to 0.5% without substantial write-offs or sale of nonperforming loans (NPLs).

BUSAN BANK -- WHAT COULD CHANGE THE RATING DOWN

Busan Bank's ratings could be downgraded if its BCA is lowered over the next 12-18 months.

The bank's BCA could be downgraded if (1) the operating environment deteriorates, resulting in a lowering of Korea's Macro Profile; (2) its TCE ratio falls below 9.0%; or (3) its annual net income/tangible assets falls below 0.4% on a sustained basis, owing to a sharp increase in credit losses.

CITIBANK KOREA -- WHAT COULD CHANGE THE RATING UP

As indicated by the positive outlook, an upgrade of Citibank Korea's ratings is likely if the bank manages to improve its profitability while maintaining its current level of capitalization and avoiding any deterioration in its asset quality.

A rise in the BCA of Citibank Korea or the BCA of its ultimate parent, Citibank, N.A.

CITIBANK KOREA -- WHAT COULD CHANGE THE RATING DOWN

While a downgrade is unlikely, given the positive outlook, the outlook could return to stable if improvements in Citibank Korea's asset quality and capital strength prove to be unsustainable.

A significant weakening in Citibank Korea's capitalization, with its ratio of tangible common equity to risk-weighted assets falling below 12%.

A severe deterioration in its asset quality, with its problem loan-to-gross loan ratio exceeding 3%.

DAEGU BANK -- WHAT COULD CHANGE THE RATING UP

An upgrade of Daegu Bank's ratings is unlikely in the near term, given the negative outlook. We would consider changing the outlook to stable if there is positive pressure on its BCA.

Upward pressure on the BCA could develop if (1) the bank's Tangible Common Equity (TCE) capital ratio is maintained at a level consistent with a BCA of baa1; or (2) the three-year average of the bank's net income/tangible assets exceeds 1.0%, both on a sustained basis and without a deterioration in asset quality.

DAEGU BANK -- WHAT COULD CHANGE THE RATING DOWN

Daegu Bank's ratings could be downgraded if (1) the operating environment for Korean banks deteriorates, resulting in a downgrade of Koreas Macro Profile; (2) the banks TCE capital ratio falls below 12%; (3) annual net income/tangible assets falls below 0.5% on a sustained basis, owing to a sharp increase in credit losses; or (4) problem loans/gross loans increases above 1.6%.

INDUSTRIAL BANK OF KOREA -- WHAT COULD CHANGE THE RATING UP

Industrial Bank of Korea's ratings are currently placed at Aa2, in-line with Korean government rating of Aa2 and thus an upgrade of Industrial Bank of Korea's ratings is unlikely unless Korean government rating is upgraded.

BCA and adjusted BCA of the bank could be upgraded if: tangible common equity (TCE) capital ratio exceeds 11.0%; or the three-year average of net income/tangible assets exceeds 1.5%, without any deterioration in asset quality.

INDUSTRIAL BANK OF KOREA -- WHAT COULD CHANGE THE RATING DOWN

Industrial Bank of Korea's ratings may be downgraded if the government support clause in the IBK Act is weakened and the banks importance to the Korean government's policies is weakened.

BCA and adjusted BCA of Industrial Bank of Korea could be downgraded if: (1) The TCE capital ratio falls below 9.5%; (2) The three-year average net income/tangible assets falls below 0.5%, owing to a sharp increase in credit losses; or (3) The problem loan ratio rises above 2.0%.

JEJU BANK -- WHAT COULD CHANGE THE RATING UP

Jeju Bank's ratings could be upgraded if the bank's tangible common equity (TCE)/risk-weighted assets (RWA) rises above 11.0% or if there is sustained improvement in the banks problem loans/gross loans to below 0.7%.

JEJU BANK -- WHAT COULD CHANGE THE RATING DOWN

Jeju Bank's ratings could be downgraded if the bank's TCE/RWA falls to below 7.0%; or if there is a fall in the liquidity coverage ratio to below the regulatory minimum of 95% in 2018.

JEONBUK BANK -- WHAT COULD CHANGE THE RATING UP

Jeonbuk Bank's ratings may be upgraded if the bank's BCA is raised.

The bank's BCA could be raised if (1) its operating environment, as measured by the Macro Profile, improves; (2) the bank improves its capitalization and maintains its tangible common equity capital ratio above 9.0%; or (3) it significantly improves its asset quality.

JEONBUK BANK -- WHAT COULD CHANGE THE RATING DOWN

Jeonbuk Bank's ratings may be downgraded if the Korean government's ability or likelihood to support the bank weakens, or if the bank's BCA is lowered.

The bank's BCA could deteriorate if its (1) operating environment deteriorates, resulting in a lowering of Korea's Macro Profile; (2) capitalization weakens significantly, with the capital adequacy ratio falling below 7%; or (3) asset quality deteriorates significantly, with problem loans/gross loans rising above 3%.

KEB HANA BANK -- WHAT COULD CHANGE THE RATING UP

KEB Hana Bank's ratings could be upgraded if (1) its tangible common equity (TCE) capital ratio exceeds 14.0%; (2) there is an improvement in asset quality, with the banks problem loan ratio falling below 0.7% on a sustained basis; of (3) the bank's three-year average net income/tangible assets exceeds 1.5% without an increase in asset risk

KEB HANA BANK -- WHAT COULD CHANGE THE RATING DOWN

KEB Hana Bank's ratings could be downgraded if (1) the bank's TCE capital ratio declines below 12.0% on a sustained basis; (2) its annual net income/tangible assets falls below 0.3%; or (3) its asset risk increases, with the banks nonperforming loan (NPL) formation ratio rising above 3.0% on a sustained basis

KOOKMIN BANK -- WHAT COULD CHANGE THE RATING UP

Kookmin Bank's ratings could be upgraded if there is (1) a significant improvement in the bank's capitalization, with its asset quality remaining stable; (2) a significant improvement in its profitability, without an increase in its risk appetite; of (3) a material improvement in its asset quality, with problem loans/gross loans falling below 0.5% and maintaining low NPL formation ratio

KOOKMIN BANK -- WHAT COULD CHANGE THE RATING DOWN

Kookmin Bank's ratings could be downgraded if there is (1) a significant weakening of the bank's capitalization, with its Tangible Common Equity Tier 1 capital ratio falling below 12%; (2) a significant deterioration in its asset quality, with the nonperforming loan (NPL) formation rate staying above 4% on a sustained basis

KOREA DEVELOPMENT BANK -- WHAT COULD CHANGE THE RATING UP

KDB's ratings may be upgraded if Korea's sovereign rating is upgraded and the deficiency guarantee in the KDB Act remains in force. The act requires the government to replenish any deficit if KDBs reserves prove insufficient to absorb any annual net losses.

Because KDB receives nine notches of uplift from its BCA and its senior unsecured debt rating is at the same level as the sovereign rating, an improvement in its credit metrics will not lead to a rating upgrade.

KOREA DEVELOPMENT BANK -- WHAT COULD CHANGE THE RATING DOWN

KDB's ratings may be downgraded if (1) Korea's sovereign rating is downgraded; or (2) there is a change in the KDB Act, which diminishes the government's responsibility of maintaining the banks solvency.

KWANGJU BANK -- WHAT COULD CHANGE THE RATING UP

Kwangju Bank's ratings may be upgraded if the bank's BCA is raised. The bank's BCA could be raised if the operating environment, as measured by the Macro Profile, improves.

The bank's ratings could be upgraded is the bank improves its capitalization and maintains its tangible common equity capital ratio above 15.0% or significantly improves its asset quality.

KWANGJU BANK -- WHAT COULD CHANGE THE RATING DOWN

Kwangju Bank's ratings may be downgraded if the ability or likelihood of Korea (Aa2 stable) to provide support to the bank weakens.

The bank's ratings may also be downgraded if its BCA is lowered. Downward pressure on the bank's BCA will develop if its (1) operating environment deteriorates, resulting in a lower Macro Profile for Korea; (2) capitalization weakens significantly, with its tangible common equity ratio falling below 12.0%; or (3) asset quality deteriorates significantly, with its problem loan ratio exceeding 1.1%.

KYONGNAM BANK -- WHAT COULD CHANGE THE RATING UP

Kyongnam Bank's ratings could be upgraded if its BCA is upgraded. Its BCA could be upgraded if: (1) the bank improves its asset quality while maintaining its high profitability and capitalization, with annual net income/tangible assets in excess of 1.0%; (2) its tangible common equity (TCE)/risk-weighted assets (RWA) improves to above 13.0%; and (3) its problem loans/total loans improves to 1.0% without substantial write-offs or sale of nonperforming loans (NPLs)

An upgrade of Busan Bank's BCA could lead to an upgrade of Kyongnam Bank's ratings because Busan Bank and Kyongnam Bank are two main subsidiaries of BNK FG and we expect Kyongnam Bank to receive continued strong support from the group, causing the two banks' Adjusted BCAs and deposit ratings to remain at similar levels.

KYONGNAM BANK -- WHAT COULD CHANGE THE RATING DOWN

Kyongnam Bank's ratings could be downgraded if its BCA is downgraded. The bank's BCA could be downgraded if: (1) the operating environment deteriorates, resulting in a lowering of Korea's Macro Profile; or (2) the bank's TCE/RWA falls below 8.0%

NONGHYUP BANK -- WHAT COULD CHANGE THE RATING UP

NongHyup Bank's ratings could be upgraded if the bank (1) significantly improving its capitalization, with its tangible common equity (TCE) ratio increasing to 13%; (2) significantly improving its funding and liquidity; or (3) Its asset quality improving significantly on a sustained basis, with the problem loan ratio falling below 1%

NONGHYUP BANK -- WHAT COULD CHANGE THE RATING DOWN

NongHyup Bank's ratings could be downgraded if there is a significant weakening of the bank's capitalization, with its TCE ratio falling below 10%; or if there is a deterioration in the bank's asset quality, with its problem loan ratio rising above 3% on a sustained basis

SHINHAN BANK -- WHAT COULD CHANGE THE RATING UP

Shinhan Bank's ratings could be upgraded if there is (1) an improvement in the bank's problem loan ratio to 0.4% without substantial write-offs or sale of nonperforming loans or (2) an improvement in the banks capitalization and asset quality, while its high profitability levels are maintained, with net income/tangible assets above 0.7%

SHINHAN BANK -- WHAT COULD CHANGE THE RATING DOWN

Shinhan Bank's ratings could be downgraded if there is (1) a deterioration in the operating environment for Korean banks, resulting in a lowering of Koreas Macro Profile; (2) a decline in the bank's tangible common equity ratio below 12.0%; (3) a decline in the bank's net income/tangible assets below 0.4%; and (4) a significant deterioration in the bank's asset risk, with problem loan ratio rising above 2.5% on a sustained basis

STANDARD CHARTERED BANK KOREA (SCBK) -- WHAT COULD CHANGE THE RATING UP

SCBK's ratings are unlikely to be upgraded further in the near term. The bank's A2 ratings already incorporate a three-notch uplift, owing to our assumption of support from its parent and Korea.

SCBK's BCA may be upgraded as a result of (1) an improvement in the bank's operating environment, as indicated by an improvement in Koreas Macro Profile; (2) a significant and sustainable improvement in its profitability; or (3) a significant improvement in its asset quality, with problem loans/gross loans declining below 0.5%.

STANDARD CHARTERED BANK KOREA -- WHAT COULD CHANGE THE RATING DOWN

A downgrade of the bank's ratings could occur if the probability of parental and government support falls notably, or if the bank's BCA is lowered. The probability of parental support could fall if the bank's strategic importance to the group diminishes, either because of a deterioration in SCBK's long-term prospects or a change in the group's global strategy. Standard Chartered Bank (SCB)'s capacity to support SCBK may also fall if SCB's standalone credit strength, as represented by its BCA, deteriorates. The probability of government support could decrease if we assess that Korea's ability or likelihood to support the bank has weakened.

Downward pressure on SCBK's BCA could develop if (1) the bank's operating environment deteriorates, resulting in a downgrade of Korea's Macro Profile; (2) its capitalization weakens substantially, with tangible common equity/risk-weighted assets falling below 12.0%; (3) its asset quality deteriorates, with problem loans/gross loans rising above 2.5%; or (4) its balance-sheet liquidity deteriorates significantly.

SUHYUP BANK -- WHAT COULD CHANGE THE RATING UP

Suhyup Bank's ratings may be upgraded if the bank's BCA rises because of an improvement in its (1) operating environment, as measured by Koreas Macro Profile; (2) funding profile, with its market funds/tangible banking assets declining below 30%; or (3) liquidity, with its liquid assets/tangible banking assets falling below 12%.

SUHYUP BANK -- WHAT COULD CHANGE THE RATING DOWN

Suhyup Bank's ratings may be downgraded if the bank's (1) policy role diminishes, resulting in a lower level of government support assumption; or (2) BCA is lowered.

The bank's BCA may be downgraded if (1) the operating environment for Korean banks deteriorates, resulting in a lowering of Koreas Macro Profile; (2) the bank's capitalization weakens, with its tangible common equity (TCE) ratio declining below 9%; (3) its asset risk deteriorates significantly with its problem loans ratio rising to above 3% on a sustained basis; or (4) its funding and liquidity profiles deteriorate significantly.

WOORI BANK -- WHAT COULD CHANGE THE RATING UP

Woori Bank's ratings could be upgraded if its financial fundamentals improve significantly, leading to upward pressure on its BCAs from (1) significant improvements in its capitalization while maintaining stable asset quality; (2) a significant decline in problem loan ratios and provision charges, while maintaining stable capitalization; and (3) a significant improvement in its funding and liquidity positions. However, a single notch upgrade in its BCA may not necessarily lead to upgrade of its long-term ratings if its improved fundamentals coincide with the sale by the government of its stake in the bank, which narrow the current government support uplift to three from four.

WOORI BANK -- WHAT COULD CHANGE THE RATING DOWN

Woori Bank's ratings could be downgraded if its BCA comes under downward pressure, which could result from: (1) a significant increase in its problem loan ratio and provision charges without increases in core capital; (2) a significant weakening of its capitalization with TCE/RWA ratios decreasing by more than 200 basis points; and/or (3) a significant deterioration in its funding and liquidity positions. The ratings could also be downgraded if Moody's assessment of government support changes, triggered by a significant decrease in the government's shareholding in Woori Bank.

KOREA SECURITIES FINANCE CORPORATION (KSFC) -- WHAT COULD CHANGE THE RATING UP

An upgrade of the sovereign rating could result in ratings upgrade for KSFC.

Upward pressure on KSFC's BCA could develop (1) from a significant improvement in the corporation's profitability, with its net income/tangible assets rising above 1.8%; or (2) if the corporation's funding structure improves, with its market funds/tangible banking assets falling below 10.0%.

KOREA SECURITIES FINANCE CORPORATION -- WHAT COULD CHANGE THE RATING DOWN

KSFC's ratings may be downgraded if (1) the Korean government's ability to provide or likelihood of providing support to KSFC diminishes, (2) KSFC's policy roles in the securities market weaken, or (3) KSFC's BCA is lowered.

Downward pressure on KSFC's BCA could develop as a result of (1) a significant change in the corporation's risk profile, resulting in greater risk taking and higher volatility in its earnings; (2) its tangible common equity/risk-weighted assets falling below 15%, or (3) its problem loans/gross loans rising above 1%.

LIST OF ASSIGNED RATINGS

The following ratings were assigned:

Busan Bank

Local currency and foreign currency Long-term Counterparty Risk Rating of A1

Local currency and foreign currency Short-term Counterparty Risk Rating of P-1

Citibank Korea Inc

Local currency and foreign currency Long-term Counterparty Risk Rating of A1

Local currency and foreign currency Short-term Counterparty Risk Rating of P-1

Daegu Bank, Ltd.

Local currency and foreign currency Long-term Counterparty Risk Rating of A1

Local currency and foreign currency Short-term Counterparty Risk Rating of P-1

Industrial Bank of Korea; Industrial Bank of Korea, Hong Kong Branch; Industrial Bank of Korea, London Branch:

Local currency and foreign currency Long-term Counterparty Risk Rating of Aa2

Local currency and foreign currency Short-term Counterparty Risk Rating of P-1

Jeju Bank

Local currency and foreign currency Long-term Counterparty Risk Rating of A2

Local currency and foreign currency Short-term Counterparty Risk Rating of P-1

Jeonbuk Bank

Local currency and foreign currency Long-term Counterparty Risk Rating of A3

Local currency and foreign currency Short-term Counterparty Risk Rating of P-2

KEB Hana Bank; KEB Hana Bank, Hong Kong Branch; KEB Hana Bank, London Branch; KEB Hana Bank, Singapore Branch:

Local currency and foreign currency Long-term Counterparty Risk Rating of Aa3

Local currency and foreign currency Short-term Counterparty Risk Rating of P-1

Kookmin Bank

Local currency and foreign currency Long-term Counterparty Risk Rating of Aa3

Local currency and foreign currency Short-term Counterparty Risk Rating of P-1

Korea Development Bank; Korea Development Bank, London Branch; Korea Development Bank, New York Branch; Korea Development Bank, Singapore Branch:

Local currency and foreign currency Long-term Counterparty Risk Rating of Aa2

Local currency and foreign currency Short-term Counterparty Risk Rating of P-1

In addition, following rating is assigned KDB subsidiaries below.

Korea Development Bank, New York Branch

Long-term Counterparty Risk Assessment , Assigned Aa2(cr)

Short-term Counterparty Risk Assessment , Affirmed P-1(cr)

Korea Development Bank, Singapore Branch

Long-term Counterparty Risk Assessment , Affirmed Aa2(cr)

Short-term Counterparty Risk Assessment , Assigned P-1(cr)

Kwangju Bank Ltd.

Local currency and foreign currency Long-term Counterparty Risk Rating of A2

Local currency and foreign currency Short-term Counterparty Risk Rating of P-1

Kyongnam Bank

Local currency and foreign currency Long-term Counterparty Risk Rating of A1

Local currency and foreign currency Short-term Counterparty Risk Rating of P-1

NongHyup Bank

Local currency and foreign currency Long-term Counterparty Risk Rating of Aa3

Local currency and foreign currency Short-term Counterparty Risk Rating of P-1

Shinhan Bank; Shinhan Bank, New York Branch;

Local currency and foreign currency Long-term Counterparty Risk Rating of Aa3

Local currency and foreign currency Short-term Counterparty Risk Rating of P-1

Standard Chartered Bank Korea Limited

Local currency and foreign currency Long-term Counterparty Risk Rating of A1

Local currency and foreign currency Short-term Counterparty Risk Rating of P-1

Suhyup Bank

Local currency and foreign currency Long-term Counterparty Risk Rating of A1

Local currency and foreign currency Short-term Counterparty Risk Rating of P-1

Woori Bank; Woori Bank, Hong Kong Branch; Woori Bank, London Branch; Woori Bank, Los Angeles Branch:

Local currency and foreign currency Long-term Counterparty Risk Rating of Aa3

Local currency and foreign currency Short-term Counterparty Risk Rating of P-1

Korea Securities Finance Corporation

Local currency and foreign currency Long-term Counterparty Risk Rating of Aa2

Local currency and foreign currency Short-term Counterparty Risk Rating of P-1

The principal methodology used in these ratings was Banks published in June 2018. Please see the Rating Methodologies page on www.moodys.com for a copy of this methodology.

Busan Bank, headquartered in Busan, South Korea, had total assets of KRW51.8 trillion (USD48.6 billion) at the end of March 2018.

Citibank Korea Inc, headquartered in Seoul, South Korea, had total assets of KRW50.4 trillion (USD47.3 billion) at the end of March 2018.

Daegu Bank, Ltd., headquartered in Daegu, South Korea, had total assets of KRW49.5 trillion (USD46.5 billion) at the end of March 2018.

Industrial Bank of Korea, headquartered in Seoul, South Korea, had total assets of KRW276.2 trillion (USD259.2 billion) at the end of March 2018.

Jeju Bank, headquartered in Jeju, South Korea, had total assets of KRW5.7 trillion (USD5.3 billion) at the end of March 2018.

Jeonbuk Bank, headquartered in Jeonju, South Korea, had total assets of KRW18.3 trillion (USD17.1 billion) at the end of March 2018.

KEB Hana Bank, headquartered in Seoul, South Korea, had total assets of KRW328.4 trillion (USD308.1 billion) at the end of March 2018.

Kookmin Bank, headquartered in Seoul, South Korea, had total assets of KRW341.6 trillion (USD320.1 billion) at the end of March 2018.

Korea Development Bank, headquartered in Seoul, South Korea, had total assets of KRW263.8 trillion (USD246.4 billion) at the end of December 2017.

Kwangju Bank Ltd., headquartered in Kwangju, South Korea, had total assets of KRW23.6 trillion (USD22.1 billion) at the end of March 2018.

Kyongnam Bank, headquartered in Changwon, South Korea, had total assets of KRW36.9 trillion (USD34.6 billion) at the end of March 2018.

NongHyup Bank, headquartered in Seoul, South Korea, had total assets of KRW269.6 trillion (USD252.9 billion) at the end of March 2018.

Shinhan Bank, headquartered in Seoul, South Korea, had total assets of KRW330.4 trillion (USD309.9 billion) at the end of March 2018.

Standard Chartered Bank Korea Limited, headquartered in Seoul, South Korea, had total assets of KRW65.2 trillion (USD61.2 billion) at the end of March 2018.

Suhyup Bank, headquartered in Seoul, South Korea, had total assets of KRW33.1 trillion (USD31.0 billion) at the end of March 2018.

Woori Bank, headquartered in Seoul, South Korea, had total assets of KRW325.8 trillion (USD305.7 billion) at the end of March 2018.

Korea Securities Finance Corporation, headquartered in Seoul, South Korea, had total assets of KRW48.6 trillion (USD45.6 billion) at the end of March 2018.

REGULATORY DISCLOSURES

For ratings issued on a program, series or category/class of debt, this announcement provides certain regulatory disclosures in relation to each rating of a subsequently issued bond or note of the same series or category/class of debt or pursuant to a program for which the ratings are derived exclusively from existing ratings in accordance with Moody's rating practices. For ratings issued on a support provider, this announcement provides certain regulatory disclosures in relation to the credit rating action on the support provider and in relation to each particular credit rating action for securities that derive their credit ratings from the support provider's credit rating. For provisional ratings, this announcement provides certain regulatory disclosures in relation to the provisional rating assigned, and in relation to a definitive rating that may be assigned subsequent to the final issuance of the debt, in each case where the transaction structure and terms have not changed prior to the assignment of the definitive rating in a manner that would have affected the rating. For further information please see the ratings tab on the issuer/entity page for the respective issuer on www.moodys.com.

For any affected securities or rated entities receiving direct credit support from the primary entity(ies) of this credit rating action, and whose ratings may change as a result of this credit rating action, the associated regulatory disclosures will be those of the guarantor entity. Exceptions to this approach exist for the following disclosures, if applicable to jurisdiction: Ancillary Services, Disclosure to rated entity, Disclosure from rated entity.

Regulatory disclosures contained in this press release apply to the credit rating and, if applicable, the related rating outlook or rating review.

The below contact information is provided for information purposes only. Please see the ratings tab of the issuer page at www.moodys.com, for each of the ratings covered, Moody's disclosures on the lead rating analyst and the Moody's legal entity that has issued the ratings.

The person who approved Busan Bank, Citibank Korea Inc, Daegu Bank, Ltd., Industrial Bank of Korea, Industrial Bank of Korea, Hong Kong Branch, Industrial Bank of Korea, London Branch, Jeju Bank, Jeonbuk Bank, KEB Hana Bank, KEB Hana Bank, Hong Kong Branch, KEB Hana Bank, London Branch, KEB Hana Bank, Singapore Branch, Kookmin Bank, Korea Development Bank, Korea Development Bank, London Branch, Korea Development Bank, New York Branch, Korea Development Bank, Singapore Branch, Kwangju Bank Ltd., Kyongnam Bank, NongHyup Bank, Shinhan Bank; Shinhan Bank, New York Branch; Standard Chartered Bank Korea Limited, Suhyup Bank, Woori Bank; Woori Bank, Hong Kong Branch; Woori Bank, London Branch; Woori Bank, Los Angeles Branch credit ratings is Minyan Liu, Associate Managing Director, Journalists Tel 852 3758 1350, Client Service Tel 852 3551 3077. The person who approved Korea Securities Finance Corporation credit ratings is Yat Man Sally Yim, Associate Managing Director, Journalists Tel 852 3758 1350, Client Service Tel 852 3551 3077.

Please see www.moodys.com for any updates on changes to the lead rating analyst and to the Moody's legal entity that has issued the rating.

Please see the ratings tab on the issuer/entity page on www.moodys.com for additional regulatory disclosures for each credit rating.

The first name below is the lead rating analyst for this Credit Rating and the last name below is the person primarily responsible for approving this Credit Rating.

Sophia Lee
VP - Senior Credit Officer
Financial Institutions Group
Moody's Investors Service Hong Kong Ltd.
24/F One Pacific Place
88 Queensway
Hong Kong
China (Hong Kong S.A.R.)
JOURNALISTS: 852 3758 1350
Client Service: 852 3551 3077

Minyan Liu
Associate Managing Director
Financial Institutions Group
JOURNALISTS: 852 3758 1350
Client Service: 852 3551 3077

Releasing Office:
Moody's Investors Service Hong Kong Ltd.
24/F One Pacific Place
88 Queensway
Hong Kong
China (Hong Kong S.A.R.)
JOURNALISTS: 852 3758 1350
Client Service: 852 3551 3077

No Related Data.
© 2018 Moody’s Corporation, Moody’s Investors Service, Inc., Moody’s Analytics, Inc. and/or their licensors and affiliates (collectively, “MOODY’S”). All rights reserved.

CREDIT RATINGS ISSUED BY MOODY'S INVESTORS SERVICE, INC. AND ITS RATINGS AFFILIATES (“MIS”) ARE MOODY’S CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES, AND MOODY’S PUBLICATIONS MAY INCLUDE MOODY’S CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES. MOODY’S DEFINES CREDIT RISK AS THE RISK THAT AN ENTITY MAY NOT MEET ITS CONTRACTUAL, FINANCIAL OBLIGATIONS AS THEY COME DUE AND ANY ESTIMATED FINANCIAL LOSS IN THE EVENT OF DEFAULT. CREDIT RATINGS DO NOT ADDRESS ANY OTHER RISK, INCLUDING BUT NOT LIMITED TO: LIQUIDITY RISK, MARKET VALUE RISK, OR PRICE VOLATILITY. CREDIT RATINGS AND MOODY’S OPINIONS INCLUDED IN MOODY’S PUBLICATIONS ARE NOT STATEMENTS OF CURRENT OR HISTORICAL FACT. MOODY’S PUBLICATIONS MAY ALSO INCLUDE QUANTITATIVE MODEL-BASED ESTIMATES OF CREDIT RISK AND RELATED OPINIONS OR COMMENTARY PUBLISHED BY MOODY’S ANALYTICS, INC. CREDIT RATINGS AND MOODY’S PUBLICATIONS DO NOT CONSTITUTE OR PROVIDE INVESTMENT OR FINANCIAL ADVICE, AND CREDIT RATINGS AND MOODY’S PUBLICATIONS ARE NOT AND DO NOT PROVIDE RECOMMENDATIONS TO PURCHASE, SELL, OR HOLD PARTICULAR SECURITIES. NEITHER CREDIT RATINGS NOR MOODY’S PUBLICATIONS COMMENT ON THE SUITABILITY OF AN INVESTMENT FOR ANY PARTICULAR INVESTOR. MOODY’S ISSUES ITS CREDIT RATINGS AND PUBLISHES MOODY’S PUBLICATIONS WITH THE EXPECTATION AND UNDERSTANDING THAT EACH INVESTOR WILL, WITH DUE CARE, MAKE ITS OWN STUDY AND EVALUATION OF EACH SECURITY THAT IS UNDER CONSIDERATION FOR PURCHASE, HOLDING, OR SALE.

MOODY’S CREDIT RATINGS AND MOODY’S PUBLICATIONS ARE NOT INTENDED FOR USE BY RETAIL INVESTORS AND IT WOULD BE RECKLESS AND INAPPROPRIATE FOR RETAIL INVESTORS TO USE MOODY’S CREDIT RATINGS OR MOODY’S PUBLICATIONS WHEN MAKING AN INVESTMENT DECISION. IF IN DOUBT YOU SHOULD CONTACT YOUR FINANCIAL OR OTHER PROFESSIONAL ADVISER.

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All information contained herein is obtained by MOODY’S from sources believed by it to be accurate and reliable. Because of the possibility of human or mechanical error as well as other factors, however, all information contained herein is provided “AS IS” without warranty of any kind. MOODY'S adopts all necessary measures so that the information it uses in assigning a credit rating is of sufficient quality and from sources MOODY'S considers to be reliable including, when appropriate, independent third-party sources. However, MOODY’S is not an auditor and cannot in every instance independently verify or validate information received in the rating process or in preparing the Moody’s publications.

To the extent permitted by law, MOODY’S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liability to any person or entity for any indirect, special, consequential, or incidental losses or damages whatsoever arising from or in connection with the information contained herein or the use of or inability to use any such information, even if MOODY’S or any of its directors, officers, employees, agents, representatives, licensors or suppliers is advised in advance of the possibility of such losses or damages, including but not limited to: (a) any loss of present or prospective profits or (b) any loss or damage arising where the relevant financial instrument is not the subject of a particular credit rating assigned by MOODY’S.

To the extent permitted by law, MOODY’S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liability for any direct or compensatory losses or damages caused to any person or entity, including but not limited to by any negligence (but excluding fraud, willful misconduct or any other type of liability that, for the avoidance of doubt, by law cannot be excluded) on the part of, or any contingency within or beyond the control of, MOODY’S or any of its directors, officers, employees, agents, representatives, licensors or suppliers, arising from or in connection with the information contained herein or the use of or inability to use any such information.

NO WARRANTY, EXPRESS OR IMPLIED, AS TO THE ACCURACY, TIMELINESS, COMPLETENESS, MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF ANY SUCH RATING OR OTHER OPINION OR INFORMATION IS GIVEN OR MADE BY MOODY’S IN ANY FORM OR MANNER WHATSOEVER.

Moody’s Investors Service, Inc., a wholly-owned credit rating agency subsidiary of Moody’s Corporation (“MCO”), hereby discloses that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by Moody’s Investors Service, Inc. have, prior to assignment of any rating, agreed to pay to Moody’s Investors Service, Inc. for appraisal and rating services rendered by it fees ranging from $1,500 to approximately $2,500,000. MCO and MIS also maintain policies and procedures to address the independence of MIS’s ratings and rating processes. Information regarding certain affiliations that may exist between directors of MCO and rated entities, and between entities who hold ratings from MIS and have also publicly reported to the SEC an ownership interest in MCO of more than 5%, is posted annually at www.moodys.com under the heading “Investor Relations — Corporate Governance — Director and Shareholder Affiliation Policy.”

Additional terms for Australia only: Any publication into Australia of this document is pursuant to the Australian Financial Services License of MOODY’S affiliate, Moody’s Investors Service Pty Limited ABN 61 003 399 657AFSL 336969 and/or Moody’s Analytics Australia Pty Ltd ABN 94 105 136 972 AFSL 383569 (as applicable). This document is intended to be provided only to “wholesale clients” within the meaning of section 761G of the Corporations Act 2001. By continuing to access this document from within Australia, you represent to MOODY’S that you are, or are accessing the document as a representative of, a “wholesale client” and that neither you nor the entity you represent will directly or indirectly disseminate this document or its contents to “retail clients” within the meaning of section 761G of the Corporations Act 2001. MOODY’S credit rating is an opinion as to the creditworthiness of a debt obligation of the issuer, not on the equity securities of the issuer or any form of security that is available to retail investors. It would be reckless and inappropriate for retail investors to use MOODY’S credit ratings or publications when making an investment decision. If in doubt you should contact your financial or other professional adviser.

Additional terms for Japan only: Moody's Japan K.K. (“MJKK”) is a wholly-owned credit rating agency subsidiary of Moody's Group Japan G.K., which is wholly-owned by Moody’s Overseas Holdings Inc., a wholly-owned subsidiary of MCO. Moody’s SF Japan K.K. (“MSFJ”) is a wholly-owned credit rating agency subsidiary of MJKK. MSFJ is not a Nationally Recognized Statistical Rating Organization (“NRSRO”). Therefore, credit ratings assigned by MSFJ are Non-NRSRO Credit Ratings. Non-NRSRO Credit Ratings are assigned by an entity that is not a NRSRO and, consequently, the rated obligation will not qualify for certain types of treatment under U.S. laws. MJKK and MSFJ are credit rating agencies registered with the Japan Financial Services Agency and their registration numbers are FSA Commissioner (Ratings) No. 2 and 3 respectively.

MJKK or MSFJ (as applicable) hereby disclose that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by MJKK or MSFJ (as applicable) have, prior to assignment of any rating, agreed to pay to MJKK or MSFJ (as applicable) for appraisal and rating services rendered by it fees ranging from JPY200,000 to approximately JPY350,000,000.

MJKK and MSFJ also maintain policies and procedures to address Japanese regulatory requirements.
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