Highest Credit Rating for POSCO

Fitch cites steel maker's cost-cut, and technology development for enviable rating

POSCO, the country's largest blast-furnace steel maker, won the highest credit rating from Fitch Credit Rating Agency among steel makers in the world getting 'A-'and 'stable'according to the credit agency announcement on May 9.
Fitch said it has put into its consideration POSCO's cost-cutting programs, successful the development of technologies and reform to arrive at the upgrade of the Korean steel maker's credit ratings.
The credit ratings agency said it has also considered the steel maker's effective production and marketing systems for rises in the sale of high value-added steel products and successful cost-cutting efforts enabling the company to make profits amid cuts in the prices of steel products in 2006, lower than previous years. POSCO was able to make the largest profit among steel makers in the world, Fitch said.
Continued increases in the sale of high value-added steel products and cost-cutting would keep the steel maker to make high profits down the road and the long-term technology development and reform in the
cost structure would play a positive role in cash flow of the company in the years to come, the international credit ratings agency said.
S&P gave POSCO 'A'in February with 'stable'ratings and the high rating given by Fitch, one of the three largest credit ratings agencies in the world, is likely to boost the steel maker's international image and it would also help the company to be able to issue bonds or other instruments to raise funds at lower interest rates at the international financial market.
International credit ratings agencies provide credit ratings of government firms and private firms on their management conditions and financial structures to investors as references for financial transactions.
In the meantime, the first POSCO Asia Forum took place at the Inter-Continental Hotel in downtown Seoul May 16 hosted by the Cheogam Foundation set up by POSCO as part of its social activities and do its social responsibility to the full. About 250 academics, diplomats and chancellors of universities in Asia including Korea, China, India, Vietnam, and Indonesia attended the event, which had the theme of 'What Asia Means to Us in Search of Prosperity and Future.'The participants in the event discussed various topics ranging from economy, industry, literature, and history to find means to bring prosperity for Asians in the future. The event is part of the foundation's major program, the POSCO Asia Fellowship Program providing fellowship to research fellows selected from Asia to conduct research on various subjects on Asia, including social and humane issues for a year and present the results at the forum every year.
Professor Kim Byung-hyun of Seoul National University, and Professor Wenfang Fan of Qinghwa University in Beijing, who received the fellowship from the foundation last year presented their papers at the event. Professor Kim made research on the subject of 'Asia's Social Capital and Factors for Economic Results,'while Professor Fan's papers were on the Study on Asian Students'Study Preference, both of them on increasing mutual understanding and cooperation in the Asian region. Each professor got 300 million won to carry out the research.
POSCO Chairman and CEO Lee Ku-taek said, in his opening speech, that POSCO Asia Forum will be the first step for searching out detailed measures for Asia to play a role to make mankind happier. He said the foundation will continue to provide support to Asia's intellectuals to continue to put spotlight on Asian culture for mutual cooperation and understanding among countries in the region
Allen Choate, representative of the Asia Foundation for Asia, in his congratulatory speech, said POSCO's hosting the international academic forum is very significant because the world takes a great interest in what's happening in Asia these days and it will be a great model for corporate contribution to society. He went on to say that Asia's prosperity and constructive exchange will be expanded through the forum. nw

POSCO Chairman & CEO Lee Ku-taek. Chairman Lee is at the podium to deliver the opening speech for the POSCO Asia Forum 2007 held in Seoul May 16.