Bank bad loans in S. Korea fall as corp. restructuring to come to end

Bad loans among South Korean banks fell in the first quarter as restructuring in the troubled shipbuilding and shipping companies came closer to an end, financial watchdog data showed Tuesday.

The ratio of bad loans among local banks to the total was 1.38 percent as of end-March, down 0.04 percentage points from three months earlier, according to the Financial Supervisory Service (FSS).

It was the lowest since the end of 2012 when the figure recorded 1.33 percent.

The falling bad loans were attributable to a fall in new delinquent loans, indicating the restructuring among the cash-strapped shipbuilders and shipping firms nearing to an end.

The FSS data showed the growth in new delinquent loans was the lowest since the 2008 global financial crisis.

Local shipbuilders and shipping firms entered the government-led restructuring by reducing workers and facilities as global trade slumped amid the global economic slowdown.

The bad loan ratio for shipbuilders and shipping companies stood at 11.56 percent and 4.68 percent each at the end of March.

(ASIA PACIFIC DAILY)