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Loan delinquency ratio among S. Korean big companies hits high in over 8 years

Xinhua, October 7, 2016 Adjust font size:

Loan delinquency ratio among South Korean big corporations hit the highest in more than 8 years due to court receivership of STX Shipbuilding and Marine, financial watchdog data showed on Friday.

Bank loans to big companies overdue more than a month stood at 2.59 percent of the total as of end-August, according to the Financial Supervisory Service (FSS).

It was the highest since the FSS began compiling the data in 2008.

The delinquency rate for big companies' loans continued to rise from 2.17 percent in June to 2.31 percent in July and 2.59 percent in August.

STX Shipbuilding and Marine, one of South Korean main shipbuilders, filed a court receivership in May, raising the overdue ratio for big companies by 1.4 percentage points.

STX Heavy Industries also filed a receivership in July, contributing to the higher delinquency ratio.

Hanjin Shipping, South Korea's largest container shipping line, filed a court receivership in September, which is expected to raise the bad debt rate for big corporations further.

The bad debt ratio for small companies stood at 0.93 percent in August, up 0.11 percentage points from the previous month.

The rate for household debts rose 0.02 percentage points over the month to 0.34 percent in August, with the ratio for mortgage loans adding 0.01 percentage point to 0.25 percent. Endit