[Apha Biz=(Chicago) Reporter Paul Lee] KRW 1.3 trillion of overseas real estate investment by local financial firms is feared to be insolvent, a report showed.

In addition, 25% of the total overseas real estate investment is due next year. The recent sharp downturn in the real estate market has led to widespread concerns over the loss of alternative investment.

According to the Financial Supervisory Service on the 10th, the balance of overseas real estate alternative investment in the financial sector reached 55.8 trillion won as of the end of June this year.

It is an increase of 2 trillion won (3.7%) from the end of June last year (53.8 trillion won).

It accounts for 0.8% of the total assets of the financial sector (6,762.5 trillion won).

By financial sector, insurance accounted for 56.8% of the total with KRW 31.7 trillion.

It is followed by banks with 9.8 trillion won (17.5%), securities with 8.3 trillion won (15.0%), mutual finance with 3.7 trillion won (6.7%), savings banks with 2.1 trillion won (3.8%) and savings banks with 100 billion won (0.2%).

By region, North America was the largest with KRW 35.8 trillion (64.2%). It is followed by 11 trillion won (19.6%) in Europe, 4.2 trillion won (7.4%) in Asia, and 4.9 trillion won (8.7%) in other and multiple regions.

Among them, the maturity by next year is KRW 14.1 trillion, accounting for 25.4% of the total.

As of the end of June, EOD occurred at 1.33 trillion won, or 3.7 percent of the 35.9 trillion won invested by financial firms in a single real estate, according to the Financial Supervisory Service. This is due to the soaring vacancy rate of commercial real estate after the COVID-19 pandemic.

 

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