Household Loans in Financial Sector Decrease by 5 Trillion Won in March... Mortgage Loans Increase by 1 Trillion Won

Financial Services Commission 'Household Loan Trends in March 2023'

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In March, the outstanding household loans across all financial sectors decreased by 5 trillion KRW compared to the previous month. While mortgage loans increased by 1 trillion KRW, showing a rising trend, the decline in other loans expanded.

According to the "Household Loan Trends in March 2023" released by the Financial Services Commission on the 10th, household loans across all financial sectors decreased by 5 trillion KRW in March. Compared to the same month last year, it fell by 1.4%, with the decline slightly widening compared to the previous month (1.3% decrease).

By loan category, mortgage loans increased by 1 trillion KRW, reversing to an upward trend. Although mortgage loans in the secondary financial sector decreased by 1.3 trillion KRW, this was offset by a 2.3 trillion KRW increase in bank-sector mortgage loans.

Other loans decreased by a total of 6 trillion KRW, mainly due to a 3.2 trillion KRW reduction in credit loans. This decline widened compared to the previous month’s 4.7 trillion KRW decrease.

By financial sector, household loans decreased in both the banking sector and the secondary financial sector.

In the banking sector, household loans decreased by 700 billion KRW, but the decline narrowed compared to the previous month’s 2.7 trillion KRW decrease. Bank-sector mortgage loans increased by 2.3 trillion KRW, influenced by policy mortgages (7.4 trillion KRW increase), but jeonse loans (2.3 trillion KRW decrease), group loans (900 billion KRW decrease), and individual mortgage loans (1.9 trillion KRW decrease) all declined. Other loans decreased by 2.9 trillion KRW, mainly due to a 2.3 trillion KRW reduction in credit loans.

In the secondary financial sector, insurance loans increased by 400 billion KRW, but mutual finance (4 trillion KRW decrease), specialized credit finance companies (400 billion KRW decrease), and savings banks (400 billion KRW decrease) led to an overall decrease of 4.4 trillion KRW.

The financial authorities stated, “Household loans across all financial sectors decreased by 5 trillion KRW in March, continuing the downward trend since September 2022. We will continue to monitor to ensure stable management of household debt and consistently check for any risk factors related to household debt due to high interest rates.”

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