Key Points
- Total national debt grows 4.1% to record 6,222 trillion won
Corporate debt rises 2.9% to 2,798 trillion won
Government debt surges 11.8% to 1,141 trillion won
The country's total government debt and corporate and household borrowing amounted to a record 6,222 trillion won (US$4.27 trillion) as of the end of the third quarter, according to data from the Bank for International Settlements (BIS).
The figure marked a 4.1 percent increase from a year earlier and a 0.9 percent rise from the previous quarter, reports Yonhap news agency.
It amounts to 247.2 percent of nominal gross domestic product (GDP), which logged its lowest level since the second quarter of 2021.
Of the total, corporate debt reached 2,798 trillion won as of end-September, up 2.9 percent from a year earlier. Household borrowing grew 2.1 percent on-year to 2,283 trillion won.
Government debt surged 11.8 percent from a year earlier to 1,141 trillion won, the data showed.
Meanwhile, financial regulator here on Thursday unveiled a set of measures to help enhance the competitiveness of savings banks that include easing regulations on mergers and acquisitions (M&As), and adopting relatively lax loan classification rules.
The Financial Services Commission (FSC) said it will set up an over 1 trillion-won (US$689 million) fund to help savings banks take soured loans off their balance sheets and launch a special vehicle to manage non-performing loans extended by savings banks.
The regulator also said it will ease rules on M&As in the sector and review savings banks' loan classification rules, which they claim are too strict given their business environment.
Data showed that savings banks' assets have steadily grown, reaching 120.9 trillion won at the end of last year, up from 92 trillion won in 2020 and 86.9 trillion won in 2010.
But their lendings are largely focused on real estate development projects and low-rated, financially weak customers, leaving them vulnerable to economic cycles, and leading to a decline in profitability and worsening financial status.
