Released on = July 10, 2007, 5:12 am

Press Release Author = Shushmul Maheshwari

Industry = Financial

Press Release Summary = South Korean banking industry, historically, has been very
aggressive in giving loans. But now it’s tightening the supervision on bank
lending to SMEs and for housing needs to curb inflation in bad credit loans.

Press Release Body = Loans provided by South Korean banks are expected to increase
at a CAGR of more than 19.2% during 2007-2011, exceeding US$ 1278 Billion in 2011,
according to a recent report “South Korean Banking Industry Analysis
(2007-2011)” by RNCOS. Increasing credit demand for Small and Medium
Enterprises (SMEs) and housing loans are expected to push the growth up.

South Korean banking industry will step up the oversight of bank loans to SMEs, a
week later the country’s chief financial regulator stated that intense
competition may result in growing loan defaults.

The Financial Supervisory Service reported that loan reviews to smaller enterprises
will be conducted daily, an information-sharing system will be set up among banks,
alongwith the strengthening of credit analysis system to check the hike in bad
credit loans. Yoon Jeung Hyun, Chairman, Financial Supervisory Commission, told
local banks to take precautionary steps in case of an unexpected slump in housing
prices and high interest rates resulting in more bad loans, as reported by
International Herald Tribune on May 22, 2007.

\"The government is trying to preempt the possible risks associated with bank lending
to smaller companies, which are vulnerable to economic downturns,\" stated Ku Yong
Uk, an analyst at Daewoo Securities in Seoul. The 18 banks of the country had
cumulative outstanding loans of over $340 Billion to SMEs as of 31, March 20007,
high by around 4.74% from December 31, 2006.

In November last year, The Bank of Korea, for the first time in nearly 17 years,
increased the reserve requirements for short-term deposits on banks. The motive
behind the move was to control lending, that has played a major role in sending
housing prices northwards. As per the financial regulator, delinquency ratio (of
bank loans to small companies) had reached around 1.24% as of March end 2007 from
over 1% in end 2006.

The report “South Korean Banking Industry Analysis (2007-2011)” by RNCOS
has found South Korean banking industry as very aggressive in providing loans to
public as its loan-deposit ratio has moved up by over 13.9% during 2001-2006,
surpassing 88.5% at 2006 end from nearly 75.37% in 2001. This indicates that a major
share of deposits is being employed in meeting the lending requisites.

The market research report provides a comprehensive overview of South Korean banking
industry including economic condition of the country, its financial system, types of
banks, and industry performance.

About RNCOS E-Services Pvt Ltd.:

RNCOS, incorporated in the year 2002, is an industry research firm. It has a team of
industry experts who analyze data collected from credible sources. They provide
industry insights and analysis that helps corporations to take timely and accurate
business decision in today\'s globally competitive environment.

For more information visit: http://www.rncos.com/Report/IM511.htm
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Contact Details = RNCOS E-Services Pvt Ltd.
Shushmul Maheshwari
Head of Business Development
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info@rncos.com