Local bank’s exposure to debt-burdened Greece tops $500 billion but it poses limited impact on the local financial market even in the case of a default, financial authorities said Sunday.

The Financial Supervisory Service said the bonds issued by Greek shipping companies were not so large here as of the end of March. The agency did not disclose a bank-by-bank breakdown of the figure but emphasized that no serious damage is expected even if Greece declares a default.

The comments were shared by local analysts, saying banks would be able to recover their loans fast “even if Greek shipping companies go belly-up,” an analyst at Daishin Securities said.

Some, however, warned that there could be indirect damage on local banks and securities companies for their overall exposure to European lenders.

“If French banks cut back on their lending to emerging markets due to the Greek crisis, South Korean lenders could suffer a credit crunch,” said Kim Wi-dae, a researcher at the Korea Center for International Finance.

Credit rating agency Standard & Poors lowered its grade on Greek debt to “CCC” last week, giving the latest sign that the EU nation may be forced to default on its debt.

By Cynthia J. Kim (cynthiak@heraldcorp.com)