Bad loans at South Korean banks jumped more than 20 percent last year, partly because of rising credit card defaults and an accounting fraud at SK Networks Co, Yonhap News Agency said on Sunday.
South Korea's 19 banks held 18.53 trillion won ($15.65 billion) of bad loans at the end of the year, 22.8 percent more than at end of 2002, Yonhap quoted the Financial Supervisory Service (FSS) as saying.
FSS officials were not immediately available for comment. The authority defines bad loans as those that have attracted no payments for three months.
"The banking sector saw a big rise in bad loans due to unpaid household debt, boosted by credit card loans, and with troubled corporates like SK Networks and LG Card Co facing debt defaults," the FSS said in the report.
Earlier this week regulators said the combined net profit at the 19 banks had plunged 48 percent to a provisional 2.67 trillion won in 2003 from 5.08 trillion in 2002.
South Korean banks had a tough 2003 because of ballooning losses at credit card units. Banks are still struggling with the aftermath of a credit boom that has left one in 10 South Koreans unable to repay loans and has inflated credit card debts to 14 percent of gross domestic product.
Comments
Comments are closed.