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The percentage of overdue payments at leading local commercial banks in the first quarter of this year has increased, as per aggregated information.

As of the 28th, the five major banks (KB, Shinhan, Hana, Woori, and NH Nonghyup) reported that the simple average of the overall delinquency rate at the end of the first quarter was 0.4%, an increase of 0.06 percentage points from 0.34% at the end of the fourth quarter last year. KB Kookmin Bank’s overall loan delinquency rate in won was 0.35%, up 0.07 percentage points compared to the previous quarter. The delinquency rates for households (0.28%) and corporations (0.40%) increased by 0.01 percentage points and 0.12 percentage points, respectively. The delinquency rate for large corporations rose sharply from 0.03% to 0.32%. A representative from KB Kookmin Bank mentioned, “Two major borrower loans were categorized as delinquent during the first quarter,” and added, “If these are excluded, the delinquency rate for large corporations remains at the 0.03% level.”

Shinhan Bank’s total default rate climbed from 0.28% to 0.32%, an increase of 0.04 percentage points. The household default rate went up from 0.24% to 0.25%, the large company default rate from 0.05% to 0.15%, and the small and medium enterprise (SME) default rate from 0.42% to 0.46%.

Hana Bank’s total delinquency rate hit 0.39%, the highest in nine years since the first quarter of 2017 (0.41%). Woori Bank’s total delinquency rate went up from 0.34% to 0.38%. NH Nonghyup Bank’s total delinquency rate increased from 0.49% to 0.55%.

A representative from a commercial bank mentioned, “Household loan defaults are slowly rising as borrowers face higher interest costs because of increasing interest rates and lower real incomes.” They further noted, “Credit risk is especially expanding among those with multiple debts, and delinquencies in mortgage loans are increasing.” Another bank source commented, “Due to uncertain global conditions and factors like inflation, there are currently no positive aspects in the overall economy, making stability and risk management crucial areas to focus on this year.”

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