South Korean banks' foreign currency deposits decline in December

Foreign currency deposits in South Korean banks declined for the first time in seven months in December as companies withdrew money to cover import bills, the central bank said Monday. Outstanding foreign currency-denominated deposits held by residents reached US$48.44 billion as of end-December, down $170 million from a record high of $48.61 billion in November, (Yonhap) news agency reported citing the Bank of Korea. It marked the first decline since May when such deposits fell by $1.66 billion. Residents include local citizens, foreigners staying here for more than six months and foreign companies. The data exclude inter-bank foreign currency deposits. The dollar-denominated deposits fell by $2.9 billion on-month to $35.91 billion as companies usually tap such deposits to cover import bills. The yuan-denominated deposits, meanwhile, rose by $2.5 billion on-month to $6.67 billion. Companies' holdings of FX deposits fell $260 million on-month to $43.01 billion while such deposits held by individuals gained $90 million to $5.43 billion, it added. In June last year, the government unveiled plans to encourage local banks to secure more foreign currency deposits in a bid to protect against external shocks.