Bank Delinquency Rate at 0.38% at End of Last Year... Up 0.13%p from Previous Year

by Yoo Jaehoon

Published 22 Feb.2024 13:10(KST)

At the end of last year, the delinquency rate of domestic banks was found to have increased compared to the previous year.

Despite high interest rates, household debt has risen to a record high as mortgage loans increased by more than 15 trillion won. On the 21st, a banner related to apartment group loans was hung at a commercial bank in Gangnam-gu, Seoul. Photo by Jinhyung Kang aymsdream@

On the 22nd, the Financial Supervisory Service announced that as of the end of December last year, the delinquency rate on won-denominated loans at domestic banks was 0.38%, up 0.13 percentage points (p) from the previous year. The new delinquency rate also rose by 0.03 percentage points to 0.10% compared to 0.07% the previous year.

By sector, corporate loans showed a delinquency rate of 0.41%, up 0.14 percentage points from 0.27% at the end of the previous year. Large corporate loans increased by 0.07 percentage points to 0.12%, while small and medium-sized enterprise (SME) loans rose by 0.16 percentage points to 0.48%. Delinquency rates for small corporations and individual business owner loans increased by 0.12 percentage points and 0.22 percentage points, respectively, reaching 0.48%.

Household loans rose by 0.11 percentage points to 0.35% compared to 0.24% at the end of the previous year. Mortgage loans increased by 0.08 percentage points to 0.23%, while household loans excluding mortgage loans rose by 0.20 percentage points to 0.66%.

The Financial Supervisory Service stated, "We plan to manage by expanding the cleanup of delinquencies and non-performing loans and encouraging sufficient provisioning for loan losses to enhance loss absorption capacity."