Temporary Suspension of Securities-Backed Loans by KOTRA and NH Investment Due to 'Bitt' Debt Investment

[Asia Economy Reporter Hwang Junho] The so-called 'debt investment,' where people borrow money to invest in stocks, has surged rapidly, leading to a temporary suspension of securities-backed loans due to the exhaustion of credit limits.

Korea Investment & Securities temporarily halted new securities-backed loans for stocks, funds, equity-linked securities (ELS), and bonds starting from 8 a.m. on the 23rd. NH Investment & Securities has also temporarily blocked new securities-backed loans since the 12th due to the exhaustion of credit limits.

Securities firms stated, "We are suspending collateral loan services due to the exhaustion of credit limits." As debt investment surged, credit limits were reached, causing the suspension of collateral loans. According to the Korea Financial Investment Association, the balance of credit loans borrowed by individuals from securities firms for stock investment stood at 25.3656 trillion won as of the 19th. It has remained above 25 trillion won for four consecutive trading days since first surpassing 25 trillion won on the 13th. This balance has increased by 6.3898 trillion won just this year.

Meanwhile, securities-backed loans for selling collateral are still available at these securities firms, and existing loan balances can have their maturities extended if conditions are met.

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