Thomson Financial BankWatch, a leading U.S. bank rating agency (and a company owned by the same parent as the ASRI), plans to form a new ratings agency in South Korea that will focus on domestic financial institutions and asset-backed securities.
The agency will be called Thomson BankWatch Ratings Korea and will link up with Daeil Investment Advisory, a financial services firm that advises on ABS and other products.
"We will focus initially on rating financial institutions, our obvious area of competitive advantage, and structured finance," said Roy Weinberger, director of international business development for BankWatch in New York.
"[ABS] is a new and potentially very sizable market in Korea, and fits well with our background since banks are the principal originators of assets that comprise structured financings."
Korea's ABS market, barely in existence one year ago, burst into activity in 1999, when at least 14 domestic securitizations were completed. Though most of them are not considered true securitizations, many believe that Korea will become one of the busiest ABS markets in Asia, after Japan.
While Korea already has three domestic agencies, none of them have any great competence in rating banks or ABS, said Weinberger. "We will provide hands-on technical assistance to assure that the rating process is performed in a manner that meets international standards, but the ratings themselves will be assigned in the context of the Korean domestic market," he added.
Launch of the new agency is pending approval from the Financial Supervisory Commission, Korea's financial regulator. It will initially be headed by Dr. Changhyon Cho, president of Daeil Investment Advisory.