Bank loan delinquency rate rebounds in Jan.

SEOUL, Feb. 24 (Yonhap) -- The delinquency rate for South Korean bank loans
rebounded in January mainly due to seasonal factors and increased delinquencies
related to the ailing Kumho Asiana Group, the financial watchdog said Wednesday.
The overall delinquency rate of bank loans to companies and households came in at
1.01 percent as of the end of January, up 0.25 percentage point from a month
earlier, according to the Financial Supervisory Service (FSS).
"The rise came as fresh delinquencies rose following year-end closing of books,
and as corporate restructuring at places like Kumho Group and some shipbuilders
was launched," the FSS said.
The delinquency rate rebounded last month from a two-year low seen in December
when banks made aggressive efforts to sell or write down a large amount of bad
debts before closing their books.
The growth in the delinquency rate had slowed since March, snapping an upward
trend that began in September 2008, when the collapse of Lehman Brothers battered
global financial markets. The rate shot up to 1.67 percent at the end of February
2009.
Creditor banks of the cash-strapped Kumho Asiana Group decided on Dec. 30 to put
two other ailing units -- Kumho Industrial Co. and Kumho Tire Co. -- under a debt
rescheduling program.
The watchdog said if new delinquencies related to the corporate overhaul are
excluded, the delinquency rate for bank loans came in at 0.93 percent as of
end-January.
The default rate of bank corporate loans rose 0.38 percentage point to 1.43
percent as of the end of last month. The corresponding rate for lending to larger
companies reached 1.21 percent, up 0.58 percentage point from the previous month
while that of loans to small firms climbed 0.33 percentage point on-month to 1.47
percent, the watchdog added.
sooyeon@yna.co.kr
(END)