Deposit Insurance-Covered Financial Product Balances Increased by 150 Trillion Last Year... Preference for Safe Assets

[Asia Economy Reporter Kwon Haeyoung] Due to the preference for safe assets amid expanding economic uncertainty, the balance of financial products covered by deposit insurance increased by nearly 150 trillion won last year.

According to the "2019 Year-End Deposit Insurance Trends" announced by the Korea Deposit Insurance Corporation on the 28th, the balance of insured deposits subject to deposit insurance stood at 2,252.3 trillion won at the end of last year, up 7.1% (148.9 trillion won) compared to the previous year.

The banking sector increased by 109.5 trillion won (8.8%), savings banks by 3.5 trillion won (6.1%), the insurance industry by 33.1 trillion won (4.3%), and the financial investment sector by 2.7 trillion won (9.4%).

Despite the low interest rate trend, the Korea Deposit Insurance Corporation analyzed that the spread of preference for safe assets due to growing economic uncertainty influenced the increase in the balance of deposit-protected products. Banks and savings banks also made efforts to secure deposits in preparation for the new loan-to-deposit ratio regulations, which had an impact.

As of the end of last year, the deposit insurance fund reserve amounted to 4.4 trillion won. The deposit insurance premiums collected by the Korea Deposit Insurance Corporation from financial companies last year totaled 1.8 trillion won.

Financial products covered by deposit insurance provided by the Korea Deposit Insurance Corporation include deposit products of banks and savings banks, investor deposits of financial investment companies, reserve funds of insurance companies, and comprehensive asset management accounts (CMA) of comprehensive financial companies.

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