...Stable `AAA' Rating: The `AAA' covered bond rating is based on Kookmin Bank's (KB) `A' Long-Term IDR, a Discontinuity Cap (D-Cap) of four (moderate risk) and the highest nominal asset percentage (AP, 47.4%) in the past 12 months that Fitch Ratings considers in its analysis, which gives greater protection compared to the `AAA' breakeven AP of 81.5%, The Outlook on the covered bonds' ratings is Stable, which reflects the Stable Outlook on KB's IDR. Rating Lifted Above Ceiling: The programme includes transfer and convertibility (T&C) risk mitigation through the covered bond swaps, which provides covered bondholders protection should a T&C event occur. This, along with overcollateralisation (OC) that supports mitigation of currency risk following a termination of the covered bond swaps allows Fitch Ratings to assign a one-notch uplift above the South Korea's Country Ceiling of `AA+' in Fitch's recovery given default analysis. Moderate D-Cap Unchanged: Fitch's D-Cap is driven by its assessment...
