Big 3 Life Insurers Near 10 Billion Loan This Year... Personal ↓ Corporate ↑

Samsung Life Personal Loan Ratio
Decreased from 65.1% Last Year to 63.3%
Corporate Loans Increased by 13.8%

[Asia Economy Reporter Oh Hyung-gil] This year, the 'Big 3' life insurance companies have nearly reached 100 trillion won in loans disbursed to the market, showing an increasing trend. While the proportion of personal loans by insurers has relatively decreased due to ultra-low interest rates and falling bank loan rates, corporate loans for alternative investments such as real estate have filled the gap.

According to the insurance industry on the 23rd, Samsung Life Insurance's loan amount as of the third quarter was 49.78 trillion won, a 4.8% increase from 47.49 trillion won in the same period last year. Personal loans amounted to 31.52 trillion won, slightly up 1.9% from the previous year, but their share of total loans decreased from 65.1% last year to 63.3%.

Meanwhile, loans to small and medium-sized enterprises (SMEs) increased by 7.8% to 10.61 trillion won from 9.84 trillion won in the same period last year. Loans to large corporations also rose 13.8% from 6.71 trillion won last year to 7.64 trillion won. Their shares of total loans increased by 0.06 percentage points and 1.2 percentage points to 21.3% and 15.3%, respectively.

During the same period, Hanwha Life Insurance's total loans grew 6.2% from 22.39 trillion won last year to 23.79 trillion won this year. Among these, personal loans increased 4.6% year-on-year to 13.36 trillion won, while corporate loans rose sharply with large corporations at 4.0073 trillion won and SMEs at 6.42 trillion won, up 15.1% and 4.6%, respectively.

Kyobo Life Insurance recorded a slight 2.3% increase in loan amounts to 20.36 trillion won compared to last year, but its personal loan volume decreased. Personal loans fell 7.4% from 10.12 trillion won last year to 9.37 trillion won this year. Conversely, corporate loans increased by 16.0% for large corporations to 3.57 trillion won and by 10.8% for SMEs to 7.41 trillion won.

The total loans of the life insurance 'Big 3' reached 93.93 trillion won, up 4.6% from the same period last year, significantly surpassing the previous year's growth rate of 2.9%. Although the overall performance disclosure for the life insurance industry has not yet been made, the loan growth trend is similarly observed in other life insurers. As of August, the life insurance industry's loan scale was 146.92 trillion won, a 5.4% increase from 139.38 trillion won in the same period last year.

Notably, a significant portion of corporate loans consists of real estate project financing (PF) loans. As of the first half of the year, the outstanding balance of insurance companies' real estate PF loan receivables was 33.6 trillion won, up 7.8 trillion won (30.2%) from 25.8 trillion won in the same period last year.

Hanwha Life's real estate PF loan volume surged 38% year-on-year to 5.7664 trillion won, Kyobo Life increased 14% to 6.9233 trillion won from 6.0968 trillion won last year, and Samsung Life also rose 12% compared to the previous year.

As corporate loans, which yield higher returns than personal loans, expand, concerns about potential defaults are emerging. Alternative investments such as real estate require additional regulatory capital (credit risk amount) to prepare for risks such as economic downturns. With financial authorities set to tighten credit loan regulations for high-income earners on the 30th, dependence on real estate loans is expected to increase further.

A life insurance industry official said, "We are managing risks mainly through loans with longer remaining terms rather than short-term loans," adding, "If banks tighten credit loans, personal loan demand may shift to insurers as an alternative channel, so the loan volume is expected to continue growing."

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