S. Korea's regulator downplays possible financial crisis

SEOUL, Oct. 7 (Yonhap) -- South Korea's financial watchdog brushed off growing concerns on Tuesday that the country may face a similar financial crisis that it underwent in 1997-98.

"Global financial markets are in trouble and there is some talk about a
possibility of another financial crisis, but the current financial situation in
South Korea is different from that of the United States and Europe," Rhee
Chang-yong, vice president of the Financial Services Commission (FSC), said in a
meeting with local analysts.
"Local banks can withstand the current foreign currency liquidity situation even
if they cannot raise funds for at least three months," Rhee said.
His remarks came as South Korea's currency market has been suffering from a
dollar shortage as banks and companies rush to the safer greenback on concerns
over a financial crisis sparked by the collapse of investment bank Lehman
Brothers Holdings Inc.
The South Korean currency tumbled to an over 6-year low against the U.S. dollar
Monday on concerns that local banks and other companies may suffer funding
shortages caused by a global financial rout. On the same day, the country's key
stock index, KOSPI, plunged 4.29 percent to 1,358.75 on massive sell-offs by
foreign and institutional investors.
The local currency was trading at 1,342.45 won as of 9:02 a.m., down 73.45 won
from Monday's close.
sooyeon@yna.co.kr
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