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199060
Thu, 08/04/2011 - 07:13
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https://oananews.org//node/199060
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Banks' bad loan rate falls in Q2
SEOUL (Yonhap) - South Korean banks' loan delinquency rate fell in the second quarter from three months earlier as they beefed up efforts to clear sour loans, the financial watchdog said Thursday.
Non-performing loans at 18 local banks reached 23 trillion won (US$22 billion), or 1.73 percent of their total lending, as of the end of June, according to the Financial Supervisory Service (FSS).
The bad loan rate was down from 2 percent as of end-March, with the amount decreasing from 26.2 trillion won.
The watchdog said the on-quarter contraction came on the heels of lenders' heightened efforts to get rid of sour loans. In the April-June period, banks cleared 9.5 trillion won of bad debts, up from 3.9 trillion won in the previous quarter.
The average bad loan rate on corporate lending reached 2.33 percent, down 0.38 percentage point from three months earlier, the FSS said. The rate on project financing loans to builders sharply declined to 12.8 percent from 18.2 percent, it added.
The non-performing loan rate on household debts stood at 0.56 percent in end-June, down 0.03 percentage point from the end of March, while the ratio on home-backed loans shed 0.04 percentage point to 0.48 percent.
The regulator said the second-quarter results were favorable, but warned of a possible pile-up of fresh bad debts down the road.
As part of efforts to curb insolvency, the FSS said it plans to encourage local banks to set annual targets for bad debt reduction.
Non-performing loans at 18 local banks reached 23 trillion won (US$22 billion), or 1.73 percent of their total lending, as of the end of June, according to the Financial Supervisory Service (FSS).
The bad loan rate was down from 2 percent as of end-March, with the amount decreasing from 26.2 trillion won.
The watchdog said the on-quarter contraction came on the heels of lenders' heightened efforts to get rid of sour loans. In the April-June period, banks cleared 9.5 trillion won of bad debts, up from 3.9 trillion won in the previous quarter.
The average bad loan rate on corporate lending reached 2.33 percent, down 0.38 percentage point from three months earlier, the FSS said. The rate on project financing loans to builders sharply declined to 12.8 percent from 18.2 percent, it added.
The non-performing loan rate on household debts stood at 0.56 percent in end-June, down 0.03 percentage point from the end of March, while the ratio on home-backed loans shed 0.04 percentage point to 0.48 percent.
The regulator said the second-quarter results were favorable, but warned of a possible pile-up of fresh bad debts down the road.
As part of efforts to curb insolvency, the FSS said it plans to encourage local banks to set annual targets for bad debt reduction.
