Sour loans creeping back up after last year’s dip

Home > Business > Finance

print dictionary print

Sour loans creeping back up after last year’s dip

The ratio of bad loans extended by Korean banks rose in the third quarter from three months earlier, largely due to a decrease in bad debt clearance, the financial regulator said yesterday.

The ratio of non-performing loans held by 18 local banks came to 1.56 percent as of the end of September, up 0.07 percentage point from 1.49 percent tallied as of end-June, according to the Financial Supervisory Service (FSS).

The bad loan ratio had dropped to as much as 1.36 percent at the end of last year, before it climbed back to 1.51 percent in the first quarter of this year.

The on-quarter gain in the bad loan ratio came as the amount of bad debt cleared by banks sharply declined to 4.8 trillion won ($4.4 billion) in the July-September period, compared with 7.0 trillion won the previous quarter, mainly dented by the economic slowdown, the FSS said.

“The bulk came from the non-performing loans in the property financing,” said an FSS official.

The bad loan ratio for corporate debts gained to 1.93 percent from 1.84 percent over the cited period.

The corresponding figure for property financing stood at 11.24 percent as of end-September.

The ratio of bad loans extended to households inched up 0.04 percentage point to 0.80 percent, with that for bad mortgages also edging up 0.09 percentage point to 0.76 percent, the FSS said.

The total outstanding amount of non-performing loans reached 21.9 trillion won in the third quarter, up 1 trillion won from three months ago, according to the watchdog.

Yonhap

More in Finance

[NEWS ANALYSIS] As foreigners rush back, market does an about-face

CU gets into the foreign exchange transaction business

Kospi hits another record high despite Covid spike

5-day winning streak ends as Kospi drops 0.62 percent

Debt is the latest hot product being pushed into the market

Log in to Twitter or Facebook account to connect
with the Korea JoongAng Daily
help-image Social comment?
lock icon

To write comments, please log in to one of the accounts.

Standards Board Policy (0/250자)

What’s Popular Now