South Korea's foreign debts grew to 418.6 billion U.S. dollars in the second quarter of this year as local lenders increased their short-term borrowing from overseas, the central bank said Tuesday.

Foreign currency debts reached 418.6 billion dollars as of the end of June, up 6.1 billion dollars from three months earlier, according to the Bank of Korea (BOK).

Short-term foreign debts that mature in one year or less expanded 5.6 billion dollars on-quarter to 141.4 billion dollars in the three months ending June 30 as local lenders increased their short-term borrowing, the central bank said.

Long-term external liabilities inched up 0.5 billion dollars on- quarter to 277.2 billion dollars in the second quarter due to a rise in foreign investment into monetary stabilization bonds (MSB) and corporate bonds that offset a fall in investment into government bonds by foreigners.

The nation's foreign debt soundness worsened more or less due to growth in short-term debts. The ratio of short-term foreign debts to foreign reserves advanced 2.3 percentage points on- quarter to 45.3 percent as of the end of June, while the rate of short-term external debts to the total foreign debts rose 0.9 percentage point to 33.8 percent.

The capability to service foreign debts was also aggravated. The country's external credit decreased 2.4 billion dollars on- quarter to 506.7 billion dollars in the second quarter, sending the net external credit, or external assets minus external liabilities, to 88.1 billion dollars as of end-June, down 8.4 billion dollars from three months before.