Seoul shares drop 2.7 pct on credit worries

(Updates to mid-morning)

SEOUL, Nov 27 (Reuters) - Seoul shares dropped 2.7 percent on Tuesday as mounting concerns over a U.S. credit crunch hit financials such as Kookmin Bank (060000.KS: Quote, Profile, Research, Stock Buzz) and exporters including Hyundai Motor Co (005380.KS: Quote, Profile, Research, Stock Buzz).

Samsung Electronics Co Ltd (005930.KS: Quote, Profile, Research, Stock Buzz) and other Samsung Group companies were also dampened after a number of group officials have been banned from travel abroad in investigations over allegations related to a slush fund and bribes.

The Korea Composite Stock Price Index (KOSPI) lost 2.71 percent as of 0130 GMT, after opening down 2.28 percent.

"No one is free from the shocks from the U.S. credit crunch, and investors are very reluctant to invest in risky assets," said Kim Joon-kie, an analyst at SK Securities.

"Samsung companies inevitably will be hit further by the investigations, which have deepened, adding more pressure on the overall market," he added.

Samsung Electronics, the world's top memory chip maker, dropped 5.33 percent to 533,000 won and Samsung Corp (000830.KS: Quote, Profile, Research, Stock Buzz), the group's core unit, plunged 7.9 percent to 58,300 won.

Samsung Heavy Industries Co Ltd (010140.KS: Quote, Profile, Research, Stock Buzz) declined 4.65 percent to 38,950 won, even as other shipbuilders rose, with Hyundai Heavy Industries Co Ltd (009540.KS: Quote, Profile, Research, Stock Buzz) up 1.28 percent to 435,500 won.

On Monday, mounting worries about mortgage losses and their impact on the world's top economy, South Korea's No.2 export market, pushed down U.S. stocks.