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Top 30 Groups’ Combined Debt Tops 600 Trillion Won
Conglomerate Debt
Top 30 Groups’ Combined Debt Tops 600 Trillion Won
  • By matthew
  • January 13, 2015, 04:43
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The amount of indebtedness of Korea’s top 30 business groups has increased by nearly 26 trillion won (US$23.97 billion) in the past two years, surpassing a total of 600 trillion won (US$553.25 billion).

According to the banking investment industry and Chaebul.com, the total amount of debt of the top 30 groups has risen to 624.3 trillion won (US$575.66 billion) as of the end of 2013. The figure is up 4.3 percent, a total of 25.7 trillion won (US$23.7 billion), compared to the figure two years ago. The amount of debt of the top 10 groups stands at 449.6 trillion won (US$414.57 billion), accounting for 72 percent of total debt.

During 2011 to 2013, by business group, the amount of debt in the Samsung Group increased by 8.6 trillion won (US$7.93 billion), from 78.9 trillion won (US$72.75 billion) to 87.5 trillion won (US$80.68 billion).

The figure in SK Group increased by 8.1 trillion won (US$7.47 billion), from 59.2 trillion won (US$54.59 billion) to 67.3 trillion won (US$62.06 billion). The debt in Lotte Group increased by 3.6 trillion won (US$3.32 billion) to 35.2 trillion won (US$32.46 billion) over the last two years, while the figure in Hyundai Heavy Industries Group increased by 900 billion won (US$829.88 million) to 30.5 trillion won (US$28.12 billion). And the amount of indebtedness in the GS Group increased by 2 trillion won (US$1.84 billion) to 30.7 trillion won (US$28.31 billion) over the last two years, while the figure in the Hanwha Group increased by 1.4 trillion won (US$1.29 billion) to 16.7 trillion won (US$15.4 billion).

The debt in Hyundai Motor Group increased from 68.7 trillion won (US$63.35 billion) to 69 trillion won (US$63.62 billion), a rise of only 300 billion won (US$276.63 million), which is a small sum of money compared to the size of the group.

The LG Group and POSCO Group decreased their debts by 1.5 trillion (US$1.38 billion) and 3.8 trillion won (US$3.5 billion), respectively.

The debt rates of Samsung, Hyundai Motor, SK, and Lotte are lower than 100 percent, which is considered good, having 43 percent, 65.7 percent, 86.8 percent and 65.8 percent respectively.

The debt rate of Hyundai Heavy Industries Group and GS Group is both 112.6 percent, while the rate of Hanwha Group is 144.8 percent, standing in the level of 100 percent.

Some groups’ financial conditions are getting even worse. The debt of Hanjin Group rose by 2.7 trillion won (US$2.49 billion), from 29.7 trillion won (US$27.39 billion) to 32.4 trillion won (US$29.88 billion), during the same period. The debt of Daewoo Shipbuilding & Marine Engineering Co., GM Korea, and OCI also increased by 1.8 trillion won (US$1.66 billion), 800 billion won (US$737.67 million), and 600 billion won (US$553.25 million), respectively.

Hanjin Group has a debt rate of 452.4 percent, ranking 2nd highest among its top 30 groups. Also, the rates of GM Korea and Daewoo Shipbuilding & Marine Engineering Co. are at the top, standing at 353.5 percent and 254.7 percent, respectively.

The debt ratio of Hyundai Group (which is currently restructuring), Kumho Asiana Group, and Dongbu Group is still high, showing rates of 540.5 percent, 381.9 percent, and 269 percent. Moreover, Hyosung Group and Dongkuk Steel Mill Co. show high rates of debt, 220.5 percent and 174.8 percent respectively, even though these companies decreased the amount of their debt.