Last Year Household Stock Investment and Loans Hit Record High... Financial Assets Stock Ratio Surpasses 20%

[Asia Economy Sejong=Reporter Son Seonhee] Last year, the scale of household stock investment once again set a new record high. It was found that the proportion of stocks in household financial assets exceeded 20% for the first time.

According to the '2021 Financial Flow (Provisional)' statistics announced by the Bank of Korea on the 7th, the net fund operation amount of households (including individual business owners) and non-profit organizations last year was 141.2 trillion won. This is 48.7 trillion won less than in 2020.

The net fund operation amount is the value obtained by subtracting the fund procurement amount from the fund operation amount of the economic entity. The decrease in households' net fund operation amount last year is analyzed to be due to the increase in consumption, which had been contracted due to COVID-19, resulting in a reduction in surplus funds.

Looking at fund operations by sector, households' equity securities and investment funds recorded 92.5 trillion won (excluding stocks issued by non-residents), an increase of 36.9 trillion won compared to the previous year. This is the largest record since the statistics were compiled in 2009.

Excluding investment funds, households operated 110.5 trillion won in domestic and foreign stocks alone. They acquired 87.6 trillion won in stocks and equity shares issued by residents (domestic stocks) and 22.9 trillion won in stocks issued by non-residents (foreign stocks). All are record highs.

As of the end of last year, the outstanding balance of households' domestic and foreign stock acquisitions (944.6 trillion won, 77.3 trillion won) both recorded all-time highs.

Accordingly, the proportion of stocks within the total financial assets of households and non-profit organizations also increased from 19.4% at the end of 2020 to 20.8% at the end of last year, surpassing 20% for the first time in history.

Last year, households' fund procurement amount was also the highest ever. Households raised 192.1 trillion won in funds, of which borrowing from financial institutions reached 189.6 trillion won. Bang Jung-kwon, head of the Financial Flow Team at the Bank of Korea's Economic Statistics Bureau, explained, "The increase in households' borrowing and other fund procurement is due to continued demand for housing-related loans and the recovery of consumption, which also increased sales credit (such as card usage before payment)."

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