[Special Stock] 'Complete Capital Erosion Concern'... Asiana Airlines Plummets Over 11%

[Asia Economy Reporter Hwang Yoon-joo] Asiana Airlines is plummeting amid concerns of complete capital erosion. Due to exchange losses caused by the sharp rise in the won-dollar exchange rate, the possibility of capital erosion is high, and with corporate bond repayments due in the first half of next year, investor sentiment is rapidly deteriorating.

As of 10:35 AM on the 31st, Asiana is trading at 10,000 won, down 11.50% (1,200 won) from the previous trading day. This marks a new 52-week low.

The exchange rate remains the issue. The won-dollar exchange rate surged more than 10% from 1,301.50 won to 1,439 won during the third quarter (end of June to end of September). It is estimated that about 360 billion won in losses were recorded due to exchange losses.

Additionally, maturing bonds such as corporate bonds are a burden. Asiana Airlines must repay 31.7 billion won of the remaining balance of 257 billion won in asset-backed securities (ABS) by November 9. It must also pay approximately 73.2 billion won in perpetual bond interest by the first half of next year, and 54 billion won in corporate bond maturities will come due.

As of the end of the first half of this year, Asiana Airlines’ debt ratio was 6,544.6%, an increase of 4,134 percentage points compared to the end of last year. Kang Seok-hoon, president of the Korea Development Bank, also acknowledged at the National Assembly’s Finance and Economy Committee audit on the 20th that Asiana Airlines is "virtually on the verge of capital erosion."

According to Korea Exchange regulations, if a listed company falls into complete capital erosion based on the year-end business report, it is grounds for delisting.

This content was produced with the assistance of AI translation services.