...Substantial Franchise: Kookmin Bank's Issuer Default Ratings (IDR) are driven by its own credit strength, which is underpinned by a strong franchise. Kookmin is a domestic systemically important bank in Korea. Its retail operation is particularly strong, manifested in a high share of mortgages and retail deposits in the system at 22% and 26%, respectively, at end-2016. Fitch Ratings expects the significant franchise to help in the bank's recovery amid low interest rates. Growth in Certain Sectors: Fitch expects Kookmin to grow its loan book by 5%-6% over the next two years, slightly above the nominal GDP growth rate of Korea. The growth will be focused on certain sectors, including the real-estate rental sector and self-employed individuals, which have provided a higher risk-adjusted return over the past few years. The bank has taken a commercial approach to weak sectors by conservatively classifying its exposures to troubled corporate segments in recent years. Sound Household Sector: Loans...
