South Korean banks’ nonperforming loans continued to grow for a fifth consecutive quarter in the three months ended December, data showed Thursday.

Loans classified as substandard or below (SBL) held by local banks had come to 12.5 trillion won (US$9.33 billion) as of end-December, up 1 trillion won from three months earlier, according to the data from the Financial Supervisory Service.

The figure has been on the rise since the fourth quarter of 2022 amid high interest rates and slow economic recovery.

The percentage of SBLs to the total outstanding loans came to 0.47 percent at the end of December, up 0.03 percentage point from three months earlier.

Bad loans extended to firms gained 1.3 trillion won to 4.4 trillion won over the cited period, while those extended to households stayed nearly unchanged at 1.1 trillion won, according to the financial regulator.

The banks’ coverage ratio had come to 212.2 percent as of end-December, down 3.0 percentage points from three months earlier.

Source: Yonhap News
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