South Korea Financial Supervisory Service reports domestic banks' won-denominated loan delinquency rate rose to 0.67% in May

The South Korea Financial Supervisory Service reported that the delinquency rate on domestic banks' won-denominated loans stood at 0.67% at the end of May 2026. That was up 0.06 percentage point from 0.61% a month earlier and 0.03 percentage point from 0.64% a year earlier. The increase reflected a KRW0.4 trillion rise in newly delinquent loans and a KRW0.1 trillion decline in resolved loans. Business loan performance deteriorated more sharply than household lending. The delinquency rate on business loans rose to 0.84% from 0.74%, with large-company loans increasing to 0.27% and small and medium-sized enterprise loans reaching 1.00%, including 1.11% for SME corporations and 0.84% for individual businesses. Household loan delinquency increased to 0.45% from 0.42%, as mortgage loans edged up to 0.31% and unsecured loans rose to 0.90%. The Financial Supervisory Service noted that banks tend to manage delinquent loans more closely at quarter-end, which usually causes delinquency rates to rise during a quarter and fall toward the quarter-end.