[Exclusive] 2030 Stock 'Debt Investment' Surges 190%

Outstanding Credit Loans at 10 Securities Firms Reach 3.4 Trillion in H1
Increase Rate Faster Among 20s Than 30s
Concerns Over Aftershocks from Interest Rate Hikes and US Tapering

[Asia Economy Reporter Jang Sehee] It has been revealed that the amount of money borrowed from securities firms by young people for stock investment surged by 190% during the COVID-19 outbreak. As liquidity increased due to low interest rates, the relatively asset-poor 2030 generation flocked to the stock market, and the scale of increased stock 'debt investment (borrowing to invest)' through securities firms has been specifically confirmed. Concerns are rising that if liquidity contraction becomes a reality due to the Bank of Korea's interest rate hikes and the US tapering (asset purchase reduction), the aftershocks of debt investment among the youth generation will be severe.

According to the 'Credit Extension Status of the 2030s' submitted by the Financial Supervisory Service to Min Hyung-bae, a member of the National Assembly's Political Affairs Committee from the Democratic Party of Korea, as of the end of June, the credit loan balance of the top 10 securities firms was 3.4297 trillion won, a 190.2% increase compared to the end of 2019 (1.1817 trillion won) before the COVID-19 outbreak. Approximately 2.2 trillion won increased in one and a half years. The credit loan balance refers to the money investors borrow from securities firms to purchase stocks, etc. Considering that the total credit loan balance of securities firms increased 2.6 times from 7.764 trillion won to 19.8824 trillion won during this period, the growth rate of credit loans among young people was even steeper.

Comparing credit loan balances as of the first half of this year, those in their 30s held 2.8973 trillion won, overwhelmingly surpassing those in their 20s (532.4 billion won). However, the growth rate was steeper among those in their 20s. The credit loan balance of people in their 20s increased more than fourfold from 122.7 billion won at the end of 2019. The balance for those in their 30s increased 2.9 times during the same period.

The stock debt investment of the youth is directly exposed to risk if a stock market downturn materializes. It can also act as a factor that expands overall stock market volatility.

Representative Min said, "The 2030 generation is engaging in excessive leverage investment through so-called debt investment and 'younggeul' (borrowing all possible funds)," adding, "Measures are needed to minimize shocks." Oh Chang-seop, a researcher at Hyundai Motor Securities, stated, "If the stock market falls, those who took credit loans may continue to sell, causing a chain reaction that could lead to further declines."

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