South Korean Banks See Fastest Household Loan Growth in Nearly Two Years
En resumen
- South Korean banks experienced the fastest growth in household loans in almost two years during May, with a 6.9 trillion won increase.
- This surge was driven by rising stock market investments and increased mortgage lending.
Resumen generado por IA
Por qué importa
Household loans extended by banks in South Korea saw their fastest growth in nearly two years in May. This increase was attributed to rising individual investments in the booming stock market and continued growth in mortgage lending.
SEOUL, June 11 (Yonhap) -- Household loans extended by banks rose at the fastest pace in nearly two years in May as lending linked to stock investment grew amid a market rally, data showed Thursday.
Outstanding household loans by banks grew 6.9 trillion won (US$4.5 billion) to 1,181.8 trillion won last month, accelerating from the previous month's 2.1 trillion-won rise, according to data by the Bank of Korea (BOK).
It marked the sharpest on-month growth since August 2024, when household loans increased 9.2 trillion won from a month earlier.
Mortgage loans increased 3.2 trillion won on-month in May, up from a 2.7 trillion-won gain in April.
Unsecured and other household loans also rose 3.7 trillion won in May following a decline of 600 billion won the previous month, marking the largest increase since April 2021, when such loans gained 11.8 trillion won.
The central bank said rising individual investments in the booming stock market drove the increase in non-mortgage loans.
The benchmark Korea Composite Stock Price Index rallied in May on strong gains in semiconductor shares, surging to the 8,400-point level from 6,500. Individual purchases were the main driver of the stock rally as foreign investors turned net sellers beginning May 7 as part of profit hunting and portfolio rebalancing.
Corporate loans rose 10.6 trillion won from a month earlier in May, following a 10.7 trillion-won gain the previous month.
Outstanding corporate loans stood at 1,408.3 trillion won as of end-May, the latest findings showed.
Preguntas abiertas
- What is the long-term outlook for household debt in South Korea?
- Will the trend of increased stock investment-linked lending continue?
- What are the potential risks associated with this rapid loan growth?
