Payment Defaults Decreasing Sharply

The rate of unfulfilled promissory notes has decreased significantly and is now at the pre-IMF level. The Bank of Korea announced on October 29 that the default rate dropped from 0.41% in August to 0.31% in September. This is the lowest figure since September 1997.
The rate fell from 0.36% to 0.26% and from 0.82% to 0.73% in Seoul and in other regions, respectively. A source at the BOK said that the reason for this is that the number of companies defaulting on their payments decreased sharply and the number of call transactions among financial institutions or bill exchanges among stable companies increased. No big companies have dishonored their promissory notes and checks since August.
The number of dishonored companies dropped from 1,337 in August to 1,085, which is the lowest since last February. Additionally, the number of new companies in the seven biggest cities grew from 1,667 in August to 1,924 in September.