South Korea's bad debt ratio falls to 10-year low in Q2


FE Team | Published: September 13, 2018 12:33:33 | Updated: September 16, 2018 13:07:30


S Korea's bad debt ratio falls to record low in Q2

The bad debt ratio among South Korean banks fell to the lowest in about 10 years in the second quarter (Q2), financial watchdog data has showed.

According to the watchdog, the Financial Supervisory Service (FSS), the loan delinquency ratio for local banks stood at 1.06 per cent as of end-June, down 0.12 percentage points from three months earlier.

It was the lowest since the end of the third quarter in 2008, a quarter right before the global financial crisis erupted, reports Xinhua.

For the past 10 years, large corporations completed restructuring process, while domestic banks lent money mainly to households.

Household debts are relatively easier for banks to manage than corporate debts.

The bad debt ratio for bank corporate loans shed 0.19 percentage points from three months earlier to 1.56 per cent as of end-June.

The figure for household loans inched down 0.01 percentage points to 0.24 per cent.

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