Financial Supervisory Service Loan Business Survey... Loan Balance Slightly Increases to 14.6 Trillion Won
[Asia Economy Reporter Song Seung-seop] On the 30th, the Financial Supervisory Service conducted a survey on the lending industry and found that the loan balance of the lending industry last year was 14.6429 trillion KRW, an increase of 106.6 billion KRW (0.7%) compared to 14.5363 trillion KRW the previous year. This was due to a slowdown in the decline of balances from savings bank-acquired lenders and some Japanese lenders, as well as an increase in loan balances from local government-registered lenders.
The loan balance of large lenders (assets over 10 billion KRW) was 11.1701 trillion KRW, a decrease of 246.2 billion KRW (2.1%). The main reason was the closure of lending companies by firms that acquired savings banks. On the other hand, the loan balance of small and medium-sized lenders recorded 3.4728 trillion KRW, an increase of 227.4 billion KRW (9.7%).
The number of people using lending services decreased by 269,000 (19.3%) over one year from 1.389 million to 1.12 million. The loan balance per lending user continued to increase, reaching 13.08 million KRW, as the proportion of secured loans rose.
By loan type, secured loans accounted for 7.6131 trillion KRW, or 52.0% of the total balance. Although the trend of increasing secured loan proportions continued, the growth rate somewhat slowed. Unsecured loans amounted to 7.0298 trillion KRW, accounting for 48.0%.
The average loan interest rate recorded 14.7%, down 1.1 percentage points from 15.8% at the end of June last year, influenced by the reduction of the statutory maximum interest rate in July.
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The Financial Supervisory Service plans to closely monitor the lending market's business trends and credit supply status for low-credit borrowers following the statutory maximum interest rate reduction. To protect lending users, on-site inspections of lenders' unsound business practices such as violations of the maximum interest rate and illegal debt collection will be strengthened. Additionally, efforts will continue to strengthen the credit supply base for low-credit borrowers, improve the lending industry system, and eradicate illegal private loans.
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