Number of companies with risk ratings up on high borrowing costs, economic slowdown

SEOUL– The number of businesses with credit risk ratings has increased this year amid high inflation, fast-rising borrowing costs and worries over an economic slowdown, data showed Monday.

According to the data from the Financial Supervisory Service (FSS), 185 firms have been given the two lowest bottom credit ratings of “C” and “D” this year.

The figure was 25 higher than what was tallied in the previous year.

Of the total, 84 companies received “C” ratings, up five from a year earlier, while 101 firms were rated “D,” which was also up 20 from the previous year.

The real-estate sector saw the number increase 12 over the cited period. The figure for the food and manufacturing sector also grew by eight on-year.

Their combined outstanding loans came to 1.5 trillion won (US$1.1 billion) as of end-September, with 86.7 percent of the total granted by banks, according to the data.

The FSS said the amount is not large enough to hurt banks’ asset soundness.

Source: Yonhap News Agency

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