S&P ups Korea

Standard & Poor's said it raised its long- and short-term foreign currency sovereign ratings on Republic of Korea to A and A-1 from A- and A-2, respectively.

The outlook is stable.

S&P said it long- and short-term domestic currency sovereign ratings were affirmed at A+ and A-1, respectively.

The agency noted the ratings are supported by improved financial sector stability, increased flexibility of Korean won and strong net external position.

The ratings are constrained by serious geopolitical risk stemming from the Democratic People's Republic of Korea (North Korea) and a high level of contingent risk posed by potential costs in reunifying the Korean peninsula, the agency said, adding slow reform of key issues such as labor relations and support for the SME sector.

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