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Samsung, Hyundai dominate profits of S. Korean companies: data

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(Globalpost/GlobalPost)

SEOUL, Jan. 13 (Yonhap) -- Samsung and Hyundai Motor, South Korea's two biggest conglomerates in terms of market capitalization and sales, accounted for nearly a third of the combined operating income of local firms in 2012, data showed Monday, the latest sign of concentration of wealth among a handful of conglomerates in Asia's fourth-largest economy.

The combined net operating income of the country's top 10 business groups reached 61.2 trillion won (US$57.9 billion) in 2012, which is equivalent to 43.2 percent of the total of 141.7 trillion won.

Samsung and Hyundai generated a combined 43 trillion won in operating income in 2012, accounting for 30.4 percent of the total, according to the data compiled by Chaebul.com, which tracks the country's family-run conglomerates, known as chaebol.

The comparable figures were 19.7 percent in 2009, 25.2 percent in 2010, and 24.6 percent in 2011, respectively, the data showed.

The figures indicate the growing dominance by a small number of conglomerates. Market watchers have argued that the government should change its economic policy which is dependent on the so-called trickle-down effect from a few conglomerates.

Samsung Group has Samsung Electronics Co., the world's largest smartphone maker, and a slew of major affiliates under its wing. Hyundai Motor Group is the country's No.2 conglomerate with control over Hyundai Motor Co. and its smaller affiliate Kia Motors Corp.

Samsung's portion of firms' total income reached 21.3 percent in 2012 with 30.2 trillion won in operating income, a sharp rise from 13.6 percent, or 16.2 trillion won, in 2009.

In the case of Samsung Electronics, the group's flagship unit, its operating income accounted for 13.1 percent of the total in 2012, compared with a 5.4 percent portion in 2009.

"Samsung's business performance can have a great impact on the real economy as well as on the financial market," said an official at the research firm.

Hyundai Motor Group's presence in the country's corporate sector is also growing. Its operating income reached 12.8 trillion won in 2012, making up for 9 percent of the total, a sharp rise from 7.2 trillion won, or 6.1 percent, in 2009.

The government said that it is analyzing the level of "economic concentration" of Samsung and Hyundai on apparent worries that too much dependence on a few business giants could pose risks for the overall economy.

"We are currently looking into the economic concentration level of Samsung and Hyundai," Finance Minister Hyun Oh-seok told reporters in Seoul.

"It is necessary for us to analyze their economic concentration level just as economy-related ministries and agencies conduct analysis on economic polarization," he added.

He said the government has not yet decided when the analysis results would be announced.

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