Korean government strongly restrains public bodies from establishing new subsidiary companies through systematic devices including feasibility or validity evaluation. Although such regulations to control subsidiary company building have been enforced, the amount of loss of equity security of public bodies has not been yet estimated. Thus, stock investment has been restrictively accessed. Within these contexts, it is urgently required to estimate the amount of a loss of equity security, incidental debt accusing of secured loan, and possibility of additional loss of each public body.

Therefore, this report analyzes current situation of stock investment and collateral, the amount of loss of equity security, and the possibility of additional loss using data based on current Audit Reports from 2003 to 2007. As the results, it is found out that a loss of over 700 billion won has been caused by equity security investment and debt security. The kinds of loss vary from one to another including stock investment in not related field and payment guarantees of subsidiary companies. Moreover, this report also points out that possibility of public bodies’ incidental debt cased by subsidiary companies’ non-fulfillment of an obligation still remains