HONG KONG (Standard&Poor's) Feb. 12, 2015--Standard&Poor's Ratings Services said today that the credit quality of major Korean commercial banks would be unaffected following the release of generally in-line preliminary results for 2014 by the banks over the past week. However, we think that they will face challenges improving their profitability in 2015. The five major Korean banks-- Kookmin Bank (A/Stable/A-1), Shinhan Bank (A/Stable/A-1), Woori Bank (A-/Stable/A-2), Hana Bank (A/Stable/A-1), and Korea Exchange Bank (A/Stable/A-1)--posted generally higher earnings and profitability compared with a year earlier. We estimate the banks' average return on assets (ROA) came in at about 0.4% in 2014, compared with about 0.35% in 2013. They incurred a significant reduction in credit costs, which more
