Critical public policy role of providing long-term housing finance. Integral link with the government with strong track record of support. Concentration in mortgage-related business. Interest-rate risk arising during loan origination and securitization. The stable outlook on Korea Housing Finance Corp. (KHFC) reflects the outlook on the sovereign credit rating of Korea (AA/Stable/A-1+). We expect KHFC to sustain both its critical public policy role of providing long-term fixed-rate mortgage loans, and its integral link with the government at least for the next few years. We therefore equalize the ratings on KHFC with those on the sovereign because we expect the agency to remain a government-related entity with almost certain likelihood of receiving extraordinary government support when needed. We would lower the
