Credit Unions Burden Insurer

Deposit insurance payments to credit unions last year were nearly 14 times the amount of insurance paid by these institutions.

According to the Korea Deposit Insurance Corporation's annual report for 2000, a total of 1,317 credit unions nationwide paid 28.1 billion won ($21.4 million) in insurance, which equals 5.2 percent of the total amount received by the corporation. But the corporation paid out 389 billion won in claims to 176 credit unions.

"The reason for the unbalance mostly lies with the massive restructuring that occurred in the financial sector," explained an official from the corporation. A researcher at the Korea Development Institute suggested that the government should adjust the insurance rates for financial companies that frequently experience financial mishaps.