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Korea reports rise in bad loans

Published: 24 Feb. 2025, 09:22 Updated: 24 Feb. 2025, 18:46

A retail unit for rent in Seoul remains empty on Feb. 16. [YONHAP]

Korea's banks, insurers, card firms and savings banks are seeing a continued rise in bad loans amid an economic slowdown and delayed clearance of real estate-related loans, data showed Monday.

According to data compiled by the Financial Supervisory Service and submitted to People Power Party Rep. Kang Min-kuk, their bad loans stood at 23.8 trillion won ($16.6 billion) as of the end of January, up from 20.6 trillion won a month earlier.

The amount has been on a steady rise from 10.5 trillion won tallied at the end of 2022 and 16.9 trillion won at the end of 2023.

Banks saw their bad loans rise to 12.7 trillion won as of the end of January from 10.6 trillion won a month earlier.

Savings banks' soured loans rose to 9.1 trillion won from 8.3 trillion won over the cited period. The amount more than tripled from 2.5 trillion won tallied some three years earlier at the end of 2021, the data showed.

The increase in bad loans came as the clearance of real estate-related loans has been delayed, while the local economy faces a prolonged downturn amid growing uncertainties.

Credit card firms also saw their bad loans surge to 1.5 trillion won as of the end of last month, up from 1.3 trillion won at the end of last year.

Insurers' bad loans rose to 500 billion won from 400 billion won over the same period, according to the data.

Yonhap