Top 4 Financial Groups Rack up 4.4 Tril. Won Bad Debt

SEOUL, KOREA- Korea's top-four financial groups saw their non-performing loans soar to the level of 4 trillion won this year. Of this, the volume of non-performing liabilities deemed impossible to collect rose 700 billion won during the same period.According to banking industry sources on November 3, the largest four financial groups including Woori, KB, Shinhan, and Hana have incurred bad debt of 16,993.1 billion won (debts in arrears for more than 3 months). This is 35.2 percent higher than 12,566.4 billion won set at the end of December last year.

Given the average asset growth rate of the financial groups has been 4 to 5 percent since the onset of the 2008 financial crisis, the 7-8 percent growth rate of bad debt is too much too fast.

By individual group, Woori Financial Group took the No. 1 position at 6,247 billion won. The bad debt of KB Financial Group has increased 1,247.7 billion won to 4,431.1 billion won for the nine-month period this year. The bad debt volume of Shinhan and Hana Financial was 3,092 billion and 3,223 billion won, respectively.

The ratio of non-performing loans out of total loans outstanding has also increased for all four financial groups. The ratio for Woori and KB rose in excess of 2 percent, from 1.77 percent to 2.69 percent for Woori and from 1.49 percent to 2.03 percent for KB. For Shinhan and Hana, the ratio inched up to 1.53 and 1.45 percent from 1.34 and 1.33 percent, respectively.

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