Banks' foreign currency liquidity conditions improve in Nov.

SEOUL, March 4 (Yonhap) -- South Korean banks' long-term foreign currency liquidity conditions improved in November from the previous month as overseas borrowing remained firm amid globally ample liquidity, the financial watchdog said Thursday.

The long-term foreign currency funding ratio of 15 local lenders stood at 137.9
percent as of the end of November, up 1.1 percentage points from a month earlier,
according to the Financial Supervisory Service (FSS).
The ratio measures the percentage of a bank's foreign currency borrowing with
more than a one-year maturity against its foreign currency lending with the same
maturity.
The FSS noted the improvement came as banks' long-term foreign currency
denominated loans declined by US$850 million and overseas borrowing fell US$420
million in November.
In the January-November period, their long-term overseas loans declined $12.36
billion while overseas borrowing gained $9.2 billion, it added.
"Despite euro-zone debt concerns, overseas borrowing conditions for local
financial firms remained sound as low interest rates around the global increased
liquidity," the watchdog said in a statement.
The watchdog said it will continue to advise local lenders to beef up their
foreign currency liquidity management to brace for a potential liquidity squeeze.
Rising deficit problems in Greece and some European countries, together with
tougher bank rules by the U.S. and China's tightening stance, are raising
concerns about a possible sharp fall in liquidity.
sooyeon@yna.co.kr
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