Moody’s rates Korea National Oil notes Aa3

Moody's Investors Service said it assigned an Aa3 rating to the proposed senior unsecured dollar-denominated notes to be issued by Korea National Oil Corp. (Aa3 positive).

The outlook is positive.

The notes will be issued under Korea National Oil’s existing global medium-term note program (provisional Aa3), which was recently upsized to $9 billion from $8 billion.

Proceeds will mainly be used to repay maturing borrowings and bonds.

"The Aa3 rating reflects the high likelihood of timely extraordinary support from the Korean government, given KNOC's important policy roles and the high reputational and contagion risks that may arise if it were to default," Moody's vice president and senior analyst Wan Hee Yoo said in a news release.

The company’s credit profile benefits from this expected support from the Government of Korea (Aa3 positive) under Moody's joint default analysis approach for government-related issuers.

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