Savings Banks Household Credit Loan Interest Rates Decline... High-Interest Loan Proportion Highest at OK Bank

[Asia Economy Reporter Kim Hyo-jin] The interest rates on household credit loans at savings banks have been declining both in terms of new issuance and outstanding balances.

According to the Financial Supervisory Service on the 8th, the average interest rate on newly issued household credit loans in December last year was 18.0%, down 1.3 percentage points from 19.3% in December 2018. The average interest rate based on outstanding balances at the end of December last year was 19.4%, a decrease of 1.6 percentage points compared to the same period the previous year.

The proportion of high-interest loans relative to total household credit loans is also decreasing. The share of high-interest loans based on new issuance in December last year was 26.9%, down 18.3 percentage points from 45.2% at the end of December 2018. The proportion of high-interest loan balances at the end of last year was 42.5%, 14.4 percentage points lower than at the end of 2018.

However, major savings banks including loan-affiliated ones such as OK (68.5%), Welcome (54.4%), SBI (46.6%), Eugene (44.6%), and Accuon (44.4%) still show a high proportion of high-interest loan balances.

The Financial Supervisory Service stated, "Although the interest rates on household loans at savings banks are gradually declining, the average interest rate on new loans still reaches 18%, indicating that economic difficulties for ordinary citizens persist. We plan to regularly disclose the average interest rates on household credit loans and the proportion of high-interest loans at savings banks and continue to encourage rationalization of loan interest rates."

Provided by the Financial Supervisory Service

This content was produced with the assistance of AI translation services.