ID :
50067
Thu, 03/12/2009 - 07:04
Auther :
Shortlink :
https://www.oananews.org//node/50067
The shortlink copeid
Local banks' corporate loan growth slows in Feb.
SEOUL, March 11 (Yonhap) -- The growth of South Korean bank loans to firms slowed in February as more large companies raised funds through debt sales and banks remained cautious about expanding lending, the central bank said Wednesday.
As of the end of February, outstanding bank loans to large and smaller firms
totaled 467.1 trillion won (US$315.8 billion), up 1.5 trillion won from a month
earlier, the Bank of Korea (BOK) said. The February growth figure was markedly
lower than a 5.8 trillion won advance in January.
"Bank loans to conglomerates dipped last month as improved market conditions
lured (companies) into debt instruments," said Lee Dae-kun, an official at the
BOK.
Local banks' loans to larger companies decreased by 1.3 trillion won to 61.4
trillion won. Lending to small and medium enterprises, however, rose by 2.8
trillion won to 405.7 trillion won, the BOK said.
Although bank loans to smaller firms posted a similar increase last month
compared with January on the back of credit guarantees by the government, the
February figure contrasts with a 3.2 trillion won increase in the same period of
2008.
Local banks are wary of extending loans to smaller firms as the slowing economy
and a corporate restructuring drive are increasing the amount of bad loans,
compromising their financial health.
Meanwhile, net debt offerings by local firms hit a record high in February. South
Korean companies' net selling of bonds reached 6.1 trillion won last month,
compared with 4.4 trillion won a month earlier, marking the largest monthly gain
since January 2000 when the BOK began to compile related data.
Local companies have had difficulty selling bonds or other short-term corporate
debt instruments in the aftermath of the collapse of U.S. investment bank Lehman
Brothers Holdings Inc.
Despite a series of rate cuts by the BOK, yields for corporate bonds with higher
credit risks remained at a high level. But a continued liquidity supply helped
drive down the returns of company bonds and commercial papers, easing worries
over a credit squeeze.
The data comes a day before the BOK holds its monthly rate-setting meeting.
Economists say the BOK will likely cuts its key interest rate by a quarter
percentage point to prop up the slowing economy. But some predicted a rate
freeze, citing an upturn in consumer prices and the won's weakness.
Since October, the BOK has lowered the borrowing costs by a total of 3.25
percentage points to a record low of 2 percent.
sooyeon@yna.co.kr
(END)
As of the end of February, outstanding bank loans to large and smaller firms
totaled 467.1 trillion won (US$315.8 billion), up 1.5 trillion won from a month
earlier, the Bank of Korea (BOK) said. The February growth figure was markedly
lower than a 5.8 trillion won advance in January.
"Bank loans to conglomerates dipped last month as improved market conditions
lured (companies) into debt instruments," said Lee Dae-kun, an official at the
BOK.
Local banks' loans to larger companies decreased by 1.3 trillion won to 61.4
trillion won. Lending to small and medium enterprises, however, rose by 2.8
trillion won to 405.7 trillion won, the BOK said.
Although bank loans to smaller firms posted a similar increase last month
compared with January on the back of credit guarantees by the government, the
February figure contrasts with a 3.2 trillion won increase in the same period of
2008.
Local banks are wary of extending loans to smaller firms as the slowing economy
and a corporate restructuring drive are increasing the amount of bad loans,
compromising their financial health.
Meanwhile, net debt offerings by local firms hit a record high in February. South
Korean companies' net selling of bonds reached 6.1 trillion won last month,
compared with 4.4 trillion won a month earlier, marking the largest monthly gain
since January 2000 when the BOK began to compile related data.
Local companies have had difficulty selling bonds or other short-term corporate
debt instruments in the aftermath of the collapse of U.S. investment bank Lehman
Brothers Holdings Inc.
Despite a series of rate cuts by the BOK, yields for corporate bonds with higher
credit risks remained at a high level. But a continued liquidity supply helped
drive down the returns of company bonds and commercial papers, easing worries
over a credit squeeze.
The data comes a day before the BOK holds its monthly rate-setting meeting.
Economists say the BOK will likely cuts its key interest rate by a quarter
percentage point to prop up the slowing economy. But some predicted a rate
freeze, citing an upturn in consumer prices and the won's weakness.
Since October, the BOK has lowered the borrowing costs by a total of 3.25
percentage points to a record low of 2 percent.
sooyeon@yna.co.kr
(END)
