Average Delinquency Rate at Four Major Banks Edges Up to 0.36%

The average loan delinquency rate for the first quarter among the four major banks—KB Kookmin, Shinhan, Hana, and Woori—was recorded at 0.36%. This represents a 0.06 percentage point increase from 0.30% at the end of last year.

Delinquency rates showed an upward trend amidst the expansion of corporate lending.

The average delinquency rate for regional bank affiliates, which have a high proportion of loans to small and medium-sized enterprises, stood at 1.07% as of the fourth quarter of last year, up 0.29 percentage points from 0.78% in the same period the previous year.

A situation requiring attention has emerged regarding bank sector soundness indicators, with the corporate credit risk index rising and the non-performing loan (NPL) coverage ratio falling. Some expressed concerns that side effects such as non-performing loans could arise if the productive finance expansion policy is operated with an emphasis on speed and performance. The complex situation facing the banking sector, which must simultaneously achieve government policy objectives, fulfill its social role, and enhance shareholder returns, was highlighted.