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Moody's upgrades Jeju Bank's deposit ratings

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Moody's upgrades Jeju Bank's deposit ratings

Moody's upgraded Jeju Bank's long- and short-term deposit ratings to A2 and P-1, respectively, from A3 and P-2, previously.

The rating agency said Sept. 23 that it upgraded the bank's adjusted baseline credit assessment to "a3" from "baa1," and affirmed its baseline credit assessment at "baa3."

The outlook is stable.

The ratings on the bank reflect its strong deposit funding and liquidity, adequate capital ratio, weak asset quality, modest profitabiltiy and high geographic concentration in Jeju Island in South Korea, Moody's said.

Moody's ratings' also reflect the support provided by parent Shinhan Financial Group Co. Ltd., which as of June 30 held a 75.3% stake in the bank, up from 68.9% at the end of 2017.

Moody's also expect the bank to receive government support should it need it given its systemic importance in the Jeju Island despite its small size.