Moody's placed the Baa1 long-term foreign and local currency issuer ratings of South Korea's Woori Card Co. Ltd. under review for upgrade.
This comes after the long-term ratings and assessments of the company's parent, Woori Bank, were also placed under review for upgrade, the rating agency said in a Dec. 12 report.
Woori Card's ratings reflect Moody's expectation of a "very high likelihood" of parental support, as well as a high likelihood of government support when needed.
The company's stand-alone credit profile remains unchanged. It reflects among other things Woori Card's "stable and solid capitalization, solid profitability despite regulatory pressures on fees" and weak but improving asset quality.
If Woori Bank's baseline credit assessment is upgraded, Moody's assumption of affiliate support applied to Woori Card could also be raised, given its long-term strategic importance to the parent lender.
The company's ratings could be upgraded if there is a material improvement in Woori Bank's overall credit profile and if Woori Card enhances its stand-alone credit profile by improving asset quality, with its problem loan ratio dropping below 1.6% while maintaining its tangible common equity/tangible managed assets ratio above 16%.
