SEJONG, Oct. 27 (Yonhap) — Loan guarantees among affiliates of South Korea’s large business groups dropped nearly 20 percent this year, the corporate watchdog said Tuesday.

Debt payment guarantees made among units of 34 conglomerates came to 86.4 billion won (US$76.5 million) as of May 1, down 20.1 percent from the end of December, according to the Fair Trade Commission (FTC).

The antitrust watchdog said four conglomerate affiliates — GS, Doosan, KCC and Nonghyup — were engaged in inter-affiliate loan guarantee practices this year. SK, Kakao and HDC were removed from the watchlist, while Nonghyup was newly included.

In September 2016, a new antitrust law put conglomerates with assets of 10 trillion won or more on the FTC watchlist. Units of those conglomerates are restricted from making equity investments or offering loan guarantees to one another. But newly designated conglomerates or new affiliates are given a two-year grace period to eliminate loan guarantees.

Such cross-loan guarantees have been banned in South Korea since 1998 as they were regarded as one of the main reasons that brought about the 1997 Asian financial crisis.

Meanwhile, 103 financial and insurance units of 18 conglomerates held 620 billion won in total investments in 242 affiliates as of May 1, up 140 billion won from end-December.