Thirty-six large companies including 17 builders will have to either undergo a debt workout program or be forced out of the market, the Financial Supervisory Service said Friday, citing the results of an annual evaluation by creditors.

Creditor banks assessed the credit risks of 1,806 companies that borrowed 50 billion won or more from financial institutions, and blacklisted 36 of them into grades C and D.

Fifteen of them, including five construction companies, a shipbuilder, two semiconductor makers and two display makers, were put under grade C for debt workout programs to normalize business with support from the creditors.

Those under grade D do not get any help from creditors. They can pursue normalization of business on their own, but most are likely to apply for court receivership. The names of the companies in question, however, remain undisclosed.

Twenty-one companies including 12 builders, a shipping company and a chipmaker received Ds. The number of companies that got grades C and D rose by four compared to last year.

“Firms subject to restructuring increased as the creditors expanded the evaluation on industries badly hit by the economic downturn such as construction, shipbuilding, shipping, semiconductors and displays,” said Choi In-ho, an official at the FSS division for corporate finance improvement.

The 36 companies were granted some 4.8 trillion won in credit from financial institutions including 4.1 trillion won from banks, 270 billion won from insurance companies, 130 billion won from mutual savings banks and 160 billion won from credit finance firms.

The FSS said the financial companies would have to appropriate about 1.1 trillion won in allowance for bad debt as their borrowers undergo restructuring.

This is expected to lower the BIS capital adequacy rates of banks by 0.08 percentage points on average, and savings banks by 0.09 percentage points, the FSS said.

“Considering the banks’ ability to absorb the losses, the restructuring won’t affect the soundness of the financial institutions much,” Choi said.

By Kim So-hyun (sophie@heraldcorp.com)