Korean public institutions’ debt surged in 2011 from the previous year due mainly to increased spending on large-scale investment projects, government data showed Sunday.
According to the data from the Finance Ministry, the debt-to-equity ratio of 286 state-invested companies and other public institutions averaged 197 percent last year, up from 165 percent a year earlier.
As of the end of last year, their liabilities totaled 463.5 trillion won ($404 billion), while their equity capital came to 235.4 trillion won.
The debt-to-equity ratio of public corporations, including Korea Water Resources Corp., soared to 195 percent from 175 percent during the period.
The debt of Korea Water Resources jumped 56 percent on-year to 12.6 trillion won due to a big-budget project to refurbish the country’s four major rivers.
State land and housing developer LH Corp. had the largest debt of 130.5 trillion won as of last year, which represents a 7.4 percent increase from the previous year.
According to the data, the combined debt of the public institutions rose 15.4 percent last year from 2010, with their total assets increasing 8.4 percent.
The public institutions’ debt level is much higher than that of private listed companies in South Korea. The average debt-to-equity ratio of 616 companies listed on the main bourse reached 96 percent last year, up 4 percentage points from a year earlier.
