Financial Blow Dodged
The Financial Supervisory Service said on Jan. 19 that Korea is relatively free from the financial instability radiating from Switzerland, adding that Korean financial companies’ foreign currency exposure to Switzerland was only US$510 million, or 0.5 percent of the total, as of the end of September last year.
“The best part of the exposure, US$480 million to be exact, is marketable securities allowing easy liquidation,” the agency explained, continuing, “The exposure to Europe as a whole is approximately US$17.4 billion, and 16.0 percent of the total.” At present, seven Swiss financial companies are doing business in Korea, but no Korean financial company is doing business in Switzerland.
Korean banks’ balance of foreign currency loans from Swiss banks is US$3.8 billion, which is equivalent to 3.0 percent of all foreign currency loans.
“It seems that the impact of the instability will be rather limited, as seen by the numbers, but we will keep watching potential risk factors very closely,” it added.