The whole range of 58 South Korean companies have suffered credit rating downgrades this year due to poor performances stemming from protracted sluggish demand in South Korea as well as abroad, as it was reported by Yonhap on Monday, Prime reports.
According to its data, this is the largest credit rating downgrade of South Korean companies since the Asian financial crisis of 1998.
The agency has quoted the data of the Korea ratings Corp., that only eight companies of South Korea have improved their performance this year.
Hit hard by an industrywide slump, most shipbuilding and building companies received rating downgrades.
Experts explain that credit rating downgrades increase the borrowing costs of the companies, as it is difficult to raise money from selling corporate bonds due to a possible U.S. rate hike and a slowdown in the Chinese economy.
"The market is also concerned about the ripple effect from a potential U.S. interest rate hike", the agency quotes the opinions of Song Tae-joon.
