The rise in loans extended to South Korea's local firms slowed in the fourth quarter with borrowings by those in the manufacturing and construction sectors shrinking from three months earlier, central bank data showed Thursday.
Corporate lending by banks and non-bank financial institutions came to 943.3 trillion won (US$771 billion) at the end of 2015, up 11.2 trillion won, or 1.2 percent, from three months earlier, according to preliminary data from the Bank of Korea (BOK).
The increase compared with a 2.2 percent on-quarter rise in the third quarter. From a year earlier, the tally marks a 6.9 percent hike.
In the three months ended Dec. 31, banks freshly added 10.2 trillion won in their combined lending to firms, while non-bank institutions extended an additional 1.3 trillion won in corporate loans.
By industry, total borrowing by companies in the service sector gained 2.6 percent, or 13.4 trillion won, from three months earlier to 524.3 trillion won.
Loans extended to manufacturing and construction firms, on the other hand, shrank 0.3 percent and 5 percent on-quarter, respectively, to 324.4 trillion won and 38.3 trillion won.
In 2015, Asia's fourth-largest economy grew 2.6 percent, markedly slowing from a 3.3 percent on-year growth in the previous year.
Such growth was still centered around domestic consumption, the central bank noted, as many of the country's manufacturing companies struggled with dwindling exports throughout the year.
South Korea's exports dropped every single month last year with the negative streak also continuing in the first two months of 2016.
In the fourth quarter, borrowings by manufacturing firms for equipment and facilities gained 2.6 trillion won from three months earlier, the BOK said.
However, their borrowings for operations dropped 3.5 trillion won from end-September, it added.
