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Photo = Financial Supervisory Service |
[Alpha Biz= Reporter Kim Jisun] In the first quarter, domestic financial institutions' overseas real estate alternative investments slightly decreased to 57 trillion KRW, while potential losses increased to 2.5 trillion KRW.
As of the end of March, overseas real estate alternative investment balances across all financial sectors stood at 57 trillion KRW, down from 57.6 trillion KRW at the end of last year, according to the Financial Supervisory Service (FSS) report on the 19th. This accounts for 0.8% of total financial assets (6,985.5 trillion KRW).
By sector, insurance had the largest share at 31.3 trillion KRW (55%), followed by banks at 12 trillion KRW (21%), securities at 7.8 trillion KRW (13.8%), mutual finance at 3.7 trillion KRW (6.4%), credit finance at 2.1 trillion KRW (3.7%), and savings banks at 1 trillion KRW (0.1%).
Regionally, North America led with 36.1 trillion KRW (63.4%), followed by Europe at 10.2 trillion KRW (17.8%), and Asia at 3.9 trillion KRW (6.9%).
Out of the 34.5 trillion KRW invested in individual projects, 2.5 trillion KRW (7.27%) faced Events of Default (EOD) by the end of March, signaling potential losses for domestic financial institutions.
The EOD cases, which allow creditors to call loans early due to heightened credit risks, increased by 900 billion KRW in Q1, following a 1 trillion KRW rise in the previous quarter. By asset type, office properties accounted for the largest share of potential defaults at 7.6 trillion KRW, followed by residential real estate at 2 trillion KRW.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
