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Hyundai Capital ups global presence

February 26, 2014

Hyundai Capital America employees work at an operation center in Dallas, Texas in this file photo. (Courtesy of Hyundai Capital Services)

By Kim Rahn

Hyundai Capital Services, Korea’s No. 1 consumer finance firm, is expanding its global presence.

While its overseas operations are bedding in, the company’s credit rating has been upgraded and its local corporation in the United Kingdom issued asset backed securities (ABS) there for the first time to a Korean financial firm.

According to the company, Standard & Poor’s raised its outlook on Hyundai Capital from stable to positive and affirmed the BBB+ rating earlier this month.

“The upgrade is noticeable because many countries and financial companies have experienced downgrades amid the protracted global recession,” an official from the firm said.

Earlier, Hyundai Capital’s ratings were revised up to BBB+ by Fitch Ratings, to A+ by Japan Credit Rating Agency (JCR), and to Baa1 by Moody’s Investors Service.

“The string of rating upgrades has come because Hyundai Capital is forming a close business relationship and joint marketing strategies with its parent firm, Hyundai Motor Group, and offers exclusive car lease services for customers of the motor company. It is also attributable to the firm’s balanced business portfolio with a growing portion of overseas operations,” the official said.

“We hope the upgraded credit status in the global bonds market will help us save fundraising expenses,” he said.

In January, Hyundai Capital’s local corporation in the United Kingdom (HCUK) issued ABS worth 300 million pounds (531 billion won) there to raise funds. It was the first Korean financial firm to do so, and the issuance came in 17 months since the company’s entry into the British market.

The Royal Bank of Scotland, one of the country’s largest financial firms, bought all of the securities with 3.3 years of maturity.

“We presume Hyundai and Kia’s global brand power and Hyundai Capital’s growing global presence made the successful issuance possible. This case will become a good model for future issuance of ABS in other European nations,” the official said.

In the U.S., Hyundai Capital America (HCA) topped the U.S. Consumer Financing Satisfaction Study by J.D. Power at the end of last year.

In the survey for 2013 by the marketing information services company, Kia Motors Finance ranked first by obtaining 851 points out of 1,000 for mass market category, while Hyundai Motor Finance ranked third with 848 points.

“It was a huge improvement, as Hyundai Motor Finance was ranked sixth and Kia was not even on the list the previous year. They beat global rivals such as Ford Credit, Toyota Financial Services and Honda Financial Services,” the official said.

“Hyundai Capital is operating in eight regions including the U.S., U.K., China, Europe and Brazil. This is only the beginning, and we’ll become a real global financial firm,” he said.