The BIS capital adequacy ratio of domestic banks as of the end of March this year averaged 11.49%, up from 11.20% at the end of 2003 and the highest since the first quarter of 2002. Bank capital grew by 4.9% and risk-weighted assets by 2.3% during the first quarter. Bank capital was pushed up by a 2.7 trillion won increase in core capital (including 1.7 trillion won in net income and 200 billion won in newly issued Tier-1 hybrid- bond securities) while risk-weighted assets rose modestly as the pace of lending to consumers and to small- and medium-sized companies slowed during the quarter.

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