Banking Sector's October KRW Loan Delinquency Rate at 0.43%... Up 0.04%p

The delinquency rate on won-denominated loans at domestic banks turned upward in October.

On the 25th, the Financial Supervisory Service announced that as of the end of October, the delinquency rate on won-denominated loans at domestic banks was 0.43%, up 0.04 percentage points from the previous month (0.39%).

The amount of new delinquencies in October was 2.4 trillion won, an increase of 200 billion won from the previous month (2.2 trillion won) due to delinquencies in large corporate loans. Accordingly, the new delinquency rate in October rose 0.01 percentage points to 0.11% from 0.10% in the previous month.

By sector, the delinquency rate on corporate loans rose 0.06 percentage points to 0.48% during the same period. The delinquency rate on large corporate loans increased 0.05 percentage points to 0.19%, and the delinquency rate on individual business loans rose 0.05 percentage points to 0.51% from 0.46% in the previous month.

The delinquency rate on household loans increased 0.02 percentage points to 0.37% from 0.35% in the previous month. The delinquency rate on mortgage loans (jumdae) rose 0.01 percentage points to 0.25% during the same period, while household loans excluding mortgage loans increased 0.06 percentage points to 0.71%.

The Financial Supervisory Service stated, "The delinquency rate at the end of October rose after falling due to sales and disposals in September, but the increase was at a level similar to recent trends. However, as the delinquency rate continues to rise due to an expansion of new delinquencies, it is necessary to prepare for the possibility of a future deterioration in asset quality. We will proactively strengthen banks' loss absorption capacity, such as loan loss provisions, and encourage the expansion of sales and disposals of delinquent and non-performing loans."