News Life and Health05 Jun 2018

South Korea:Bad loan rate among insurers rises in 1Q

05 Jun 2018

The loan delinquency rate among South Korean insurance companies rose in the first quarter of this year as market rates increased on expectations of a Bank of Korea (BOK)'s policy rate hike, data from the financial regulatory authorities show.

Debts owed by households and companies to insurers amounted to KRW210.9 trillion ($195.8 billion) at end-March, up 1.5% from three months earlier, according to the Financial Supervisory Service.

Household loans rose by 0.7% to KRW117.3 trillion at the end of 1Q2018 while corporate loans grew by 2.5% to KRW92.9 trillion.

Delinquent loans, which are debts overdue by at least one month, stood at 0.52% of the total loan balance at end-March, up 0.01 percentage point from three months ago.

The central bank raised its benchmark interest rate last November to 1.5% from an all-time low of 1.25%, the first rate increase in almost six and a half years.


 

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