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Banks' loan delinquency rate increases for 2nd month in May

All Headlines 08:36 July 03, 2018

SEOUL, July 3 (Yonhap) -- South Korean banks' loan delinquency rate rose for the second straight month in May as more companies were late repaying their debts, government data showed Tuesday.

The rate for won-denominated bank loans more than 30 days overdue stood at 0.62 percent at the end of May, up 0.03 percentage point from a month earlier, according to the data from the Financial Supervisory Service (FSS).

Compared with a year earlier, the loan delinquency rate was up 0.04 percentage point.

The delinquency rate for corporate loans came to 0.91 percent as of end-May, up 0.05 percentage point from a month earlier.

Banks' loan delinquency rate increases for 2nd month in May - 1

The figure for loans extended to large companies rose to 1.81 percent from 1.76 percent, while that for small and medium-sized enterprises climbed to 0.69 percent from 0.64 percent.

The jump in the delinquency rate for loans to big businesses was attributed to the continued fallout from struggling Sungdong Shipbuilding & Marine Engineering Co. that was placed under court receivership in April.

The delinquency rate for loans to households edged up 0.01 percentage point on-month to 0.28 percent at the end of May, according to the data.

The FSS said it will keep close tabs on loan delinquency trends to prevent rising market interest rates from leading to increased overdue loans.
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