In another blow to creditors, Dongyang Engineering and Construction Corp. filed for court receivership at Seoul Central District Court yesterday, underscoring the debt problems created by construction-related financing loans, the JoongAng Daily reported. The midsize builder cooperated with Sambu Construction, which also recently filed for court receivership, in building luxury villas in Naegok-dong, southern Seoul. “I can’t believe how entangled the situation is,” said a Financial Supervisory Service official.

South Korea's central bank left interest rates unchanged as expected Tuesday, opting to take stock after inflation pressures showed signs of moderating in March, but hinted afterward that it's likely to resume tightening in the coming months, The Wall Street Journal reported. The vote to keep the base rate steady at 3% was not unanimous, said Bank of Korea Governor Kim Choong-soo at a media briefing. He added that the central bank is "very determined" to keep normalizing its policy rate.

Takefuji Corp. said Monday that it has granted South Korean consumer lender A&P Financial Co. preferential negotiating rights to take over the failed Japanese consumer lender in what would be one of the biggest acquisitions by a South Korean firm of a Japanese company, but the unexpected development is leading bondholders and a rival bidder to question the way the lender's court administrators have handled the sale process, The Wall Street Journal reported.

The vice chairman of the nation’s financial regulator hinted Thursday that the financial authorities are against the consolidation between Woori Investment & Securities and Daewoo Securities, The Korea Times reported. “I wonder if it will work efficiently when financial firms are combined just to beef up their size,” Kwon Hyouk-se, vice chairman of the Financial Services Commission (FSC), said in a meeting with reporters. The 54-year-old life-time bureaucrat is also a nominee for the governor of the Financial Supervisory Service (FSS), the executive body of the FSC.

Korea Line Corp., the second-largest shipping company in South Korea, filed for Chapter 15 bankruptcy protection in New York on Friday, seeking to temporarily stay several pending U.S. legal disputes as it moves forward with a rehabilitation proceeding in South Korea, Bankruptcy Law360 reported. The Seoul-based company lodged the petition in the U.S. Bankruptcy Court for the Southern District of New York, indicating that it had nearly $61 million in liquid assets.

South Korea’s financial regulator said Tuesday that it has suspended one more savings bank reeling from massive construction financing loans defaults, The Korea Times reported. The Financial Services Commission (FSC) announced it had suspended Domin Savings Bank, based in Chuncheon, Gangwon Province, for six months. The lender closed its six branches there voluntarily earlier in the day for fear of a bank run. Domin is one of five savings banks that have failed to meet the government’s recommendation of a 5-percent capital adequacy ratio.

The historically high level of Korean household debt seems to be a ticking time bomb for the economy, but this isn’t keeping policymakers from encouraging people to borrow more to secure the concrete in the crumbling housing market, The Korea Times reported. The government is planning to announce a package of measures next month aimed at helping potential homebuyers and tenants. The crux may include loosening the country’s debt-to-income (DTI) and loan-to-value (LTV) ratios, which restrict the borrowing proportion of homebuyers in relation to their earning abilities.

Korea Line Corp said it has started restructuring after a local court approved placing the financially-strapped dry bulk group in receivership, Reuters reported. South Korea's second-biggest dry bulk shipping line filed for bankruptcy protection in late January, struggling with high-cost charter contracts amid a sharp drop in freight rates since the economic turmoil of 2008. This had rocked confidence in the shipping industry and provoked fears that other bulk shippers may be exposed to Korea Line, weighing on their shares.

Korea Line Corp., South Korea’s second-largest operator of dry-bulk ships, filed for receivership after a global oversupply of vessels caused rates to tumble to the lowest in almost two years, Bloomberg reported. The shipping line intends to maintain operations, it said today in an e-mailed statement, after making the filing at the Seoul Central District Court. The company, which didn’t say how large its debts were, is seeking to freeze assets. Korea Line, unprofitable in six of the past seven quarters, halted its shares as it works to restructure debt.

Hyundai Motor Group on Friday signed a preliminary agreement to buy Hyundai Engineering & Construction Co. in a deal worth up to $4.72 billion, a step that brings nearer the completion of the drawn-out sale process for South Korea's largest construction company, which has been marked by a fierce family feud, Dow Jones Daily Bankruptcy Review reported. Hyundai E&C, the founding component of what was once the country's largest conglomerate, was put on the block in July.