(Photo = Yonhap news)

[Alpha Biz= Reporter Paul Lee] Nice Credit Ratings said on the 25th that it has lowered its credit rating outlook for KB, Daishin, Daol and Acuon Savings Bank from 'stable' to 'negative'. It left open the possibility of lowering the credit rating if the savings banks' financial status does not improve.

They recorded a large deficit because they accumulated a large amount of provisions due to poor real estate PF. KB and Daishin Savings Bank posted net losses of 93.6 billion won and 44 billion won, respectively. Daol Savings Bank's net loss was relatively small at 8.2 billion won, but like the two companies, the outlook for its credit rating was downgraded as the level of real estate PF risk exposure exceeded 200% of its equity capital.

However, Nice Credit Ratings predicted that even if the financial status of savings banks worsens, it is unlikely that it will spread to large-scale insolvency as in 2011 as the basic physical strength of the industry has improved. As of the end of last year, the capital ratio of the Bank for International Settlements (BIS) at 79 savings banks in Korea stood at 14.4%, far above the standard by which the Financial Supervisory Service implements timely corrective measures (8%).

 

 

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