The capital adequacy ratio of South Korean bank holding companies fell in the third quarter, due to an increase in risk-weighted assets such as equities and loans, the financial regulator said Wednesday.

The average capital adequacy ratio of nine local bank holding companies, including top player Woori Finance Holdings Co., stood at 13.54 percent as of the end of September, down 0.24 percentage point from three months earlier, according to the Financial Supervisory Service.

The figure comes after their capital adequacy ratio soared to a record high of 13.78 percent at the end of June.

The FSS said the on-quarter decline came as a 4.7 percent rise in risk-weighted assets outweighed a 2.8 percent growth in the financial holding firms’ equity capital.

Most of the nine firms saw their capital adequacy ratio deteriorate in the third quarter, with the exception of KB Financial Group Inc. and BS Financial Group Inc., according to the data.

KB Financial saw its capital ratio improve 0.66 percentage point, thanks to equity sales, while the corresponding figure for BS Financial Group gained 0.1 percentage point.

In contrast, state-run KDB Financial Group Inc. saw its capital ratio fall the most by 1.5 basis points, due to stock losses, the FSS said.

The regulator said it plans to instruct bank holding firms to brace against market risks as well as build up a sound capital structure by refraining from excessive dividend payouts.

(Yonhap News)