Bloomberg News

Europe Won’t Cause S. Korea Forex Crunch, Bank Regulator Says

December 10, 2011

Dec. 11 (Bloomberg) -- Repayment calls from Europe probably won’t cause a currency-exchange crunch among South Korean banks because the lenders already have secured enough foreign-asset liquidity, the Asian country’s financial regulator said.

Foreign-currency cash liquidity at local banks gained fivefold at the end of October compared with the level at the end of June, South Korea’s Financial Supervisory Service said today in an e-mailed statement.

Borrowing, including loans and bonds from European countries, totaled $43.6 billion at the end of October, accounting for 34 percent of overseas borrowing, the regulator said. That compares with $42 billion at the end of June, when Europe accounted for 36 percent of overseas borrowing, it said.

--Editors: Drew Gibson, Seyoon Kim.

To contact the reporter on this story: Seonjin Cha in Seoul at scha2@bloomberg.net

To contact the editor responsible for this story: Jim McDonald at jmcdonald8@bloomberg.net


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