It turned out that 4 out of 10 corporations could not even pay interest with the money they earned over the past year. While the profitability of major corporations improved significantly thanks to strong semiconductor exports, the deterioration of management among the remaining small and midsize corporations is deepening.
According to the 2025 corporate management analysis results released by the Bank of Korea on the 10th, the share of corporations with an interest coverage ratio below 100% last year was 39.9%, up from 38.5% a year earlier. This is the highest level since the Bank of Korea began compiling the related statistics in 2013.
The interest coverage ratio refers to the burden of interest expense relative to operating profit. A reading below 100% means interest cannot be fully paid from operating profit. Corporations below 100% for three consecutive years are classified as marginal corporations.
The share of corporations posting an operating loss (interest coverage ratio below 0%) last year also rose to 28.2% from 26.2% a year earlier. By contrast, corporations with an interest coverage ratio of 500% or higher, considered to have strong profitability, fell to 32.6% from 33.1% over the same period. The 300%–500% share shrank to 6.7% from 7.2%, and 100%–300% decreased to 20.8% from 21.2%.
The sales growth rate, which shows the growth potential of corporations, slowed to 2.5% last year from 4.2% a year earlier. However, the operating margin on sales, which indicates profitability, rose to 6.2% from 5.4% over the same period. The debt ratio, a stability indicator for corporations, also improved to 98.3% from 103.4%.
This analysis is based on a survey of 34,456 corporations, including 13,918 manufacturing corporations and 20,538 nonmanufacturing corporations.