The ratio of non-performing loans at South Korean banks has dropped to the lowest level since 2008.
 
According to data by the Financial Supervisory Service(FSS) on Wednesday, domestic banks’ non-performing loan ratio was one-point-25 percent at the end of the second quarter, down point-13 percentage point from three months earlier.
 
The figure marks the lowest since late 2008, when the ratio was one-point-14 percent.
 
It is even lower than the comparable figures for the U.S. and Japan, which stood at one-point-32 percent and one-point-31 percent in March, respectively.
 
The drop in the ratio is attributed to a sharp decrease in the bad loans of large companies as restructuring in the domestic shipbuilding and shipping sectors have been completed. The bad loans of households also remained at a low level due to modest interest rates. 
 
The total amount of bad loans stood at 21-point-eight trillion won at the end of June, down one-point-nine trillion won from the previous quarter.