Fitch: Sovereign aid boosts Korean banks

Fitch Ratings commented in a special report that measures taken to date by the Korean government to support the country's banks and economy amidst the current global economic slowdown have been swift, wide-ranging and deep, and should go a considerable way to mitigating the negative effects of the slowdown.

Fitch said the government is offering direct support to capital, asset quality and liquidity of the banking system, which has been facing a challenging business climate due to the global slowdown and unprecedented tight liquidity in global capital markets.

The agency highlighted the government's commitment to ensuring the capital adequacy and liquidity of Korea's banks, which Fitch said it expects to continue even in the event that economic conditions deteriorate further.

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