Loan defaults on the rise

The number of loan defaults in Korea reached 1.09 million as of June, up 19.5 percent from six months earlier, credit data showed on Sunday.

According to Nice Information Service, the number of people who failed to pay back loans they got from local lenders and financial firms rose by 179,000 in the January-June period.

The figure had been declining in the past couple of years, so the sudden reversal is seen as a shock warranting attention from policymakers. The number of defaults is likely to go up further due to the slowing global economy and the tightening of loans by local lenders faced with a possible liquidity crunch linked to eurozone debt woes.

(monicasuk@heraldcorp.com)