A large number of South Korean companies have suffered credit rating downgrades this year due to poor performances stemming from protracted sluggish demand, despite an upgrade in the country's sovereign rating, market data showed Sunday.

According to the data compiled by Korea Investors Service Inc., one of the three leading local credit rating agencies, it downgraded the ratings of 45 companies during the January-October period, marking the largest number since 1998, when it hit 61 in the aftermath of the Asian financial crisis.

In the heat of the 2008 global financial crisis, 33 businesses had their ratings cut, the data added.

Nice Investors Service Co., another corporate rating agency, lowered 56 companies' credit ratings over the first 10 months of the year, while Korea Ratings Corp. downgraded 42 enterprises in the first three quarters.

Meanwhile, the global rating agency Standard & Poor's raised the sovereign rating of Asia's fourth-largest economy to AA-minus from A-plus in September, citing the strength of its economic growth.

The other two major agencies -- Moody's and Fitch Ratings -- have already placed South Korea at the same level over the past three years.

Hit hard by an industrywide slump, most shipbuilding, shipping, building and petrochemical companies received rating downgrades.

Samsung Group, the country's largest conglomerate, saw ratings of three affiliates -- Samsung Engineering Co., Samsung Heavy Industries Co. and Samsung Fine Chemicals Co. -- fall over the cited period.

Doosan Engineering & Construction Co., Doosan Heavy Industries & Construction Co., POSCO Engineering & Construction Co., SK Energy Co. and GS-Caltex Corp. accepted rating cuts.

Experts explain that credit rating downgrades increase the borrowing costs of the companies, as it is difficult to raise money from selling corporate bonds.

The recent government-led strict corporate restructuring also kept cash-strapped companies from borrowing money from financial institutions.

They expect the downside tendency of corporate ratings to continue further next year due to a possible U.S. rate hike, a weak Japanese currency and a slowdown in the Chinese economy.

"Those external factors from the U.S., Japan and China will linger, with the South Korean companies' earnings recovering at a slower pace," said Moon Chang-ho from Korea Investors Service. "I don't expect a turnaround in downbeat corporate credit ratings before the first half of next year." (Yonhap)