S.Korea's non-performing loans hit 15-year high in 2015

Non-performing loans (NPL) among South Korean banks posted the largest in 15 years due to growth in distressed debts from shipping companies and shipbuilders, financial watchdog data showed on Monday.

Banks' sub-standard debts, which were overdue for more than three months, reached 29.98 trillion won (26.35 billion U.S. dollars) as of end-2015, up 5.76 trillion won from a year earlier, according to the Financial Supervisory Service (FSS).

The figure marked the largest since 2000, almost doubling 14.73 trillion won in 2008 and 15.96 trillion won in 2009 when the global financial crisis peaked.

Last year's increase in non-performing loans were mainly attributable to massive losses from shipping firms and shipbuilders, which delayed debt repayment or went into court receivership.

South Korea's government plans to offer state funds to restructure the so-called zombie companies, especially in shipping and shipbuilding industries.

Sub-standard debts from big corporations amounted to 17.69 trillion won in 2015, accounting for 4.05 percent of the total debts to big companies. It was up 7.33 trillion won compared with the previous year.

The figure marked the largest since the FSS began compiling the data in 2008, and also was the fastest yearly increase.

In contrast, non-performing loans from small firms and households reduced last year by 886 billion won and 613 billion won respectively. Endit