Household Loans Increased by 2.4 Trillion Won in September... Mortgage Loans Rose by 5.7 Trillion Won

In September, household loans across the entire financial sector increased by 2.4 trillion KRW. Housing mortgage loans, which are cited as a cause of the expansion of household debt, also increased by approximately 5.7 trillion KRW.

View of Yeouido Hanyang Apartment from the 63 Building Observatory. Photo by Hyunmin Kim kimhyun81@

According to the "Household Loan Trends in September 2023 (Provisional)" announced by the Financial Services Commission on the 12th, household loans across all financial sectors increased by 2.4 trillion KRW last month. The monthly increase, which had been rising in May (2.8 trillion KRW), June (3.5 trillion KRW), July (5.3 trillion KRW), and August (6.1 trillion KRW), turned to a decline.

By category, the increase in housing mortgage loans continued, but the scale narrowed, while other loans saw an expanded decrease.

In the case of housing mortgage loans, the banking sector increased by 6.1 trillion KRW, but the secondary financial sector decreased by 400 billion KRW, resulting in a total increase of 5.7 trillion KRW. In the banking sector, this was a 900 billion KRW decrease compared to the previous month, and the decrease in the secondary financial sector was similar to the previous month. For other loans, due to the inflow of Chuseok bonuses and a reduction in limit loans, the banking sector decreased by 1.3 trillion KRW, and the secondary financial sector decreased by 2.1 trillion KRW, totaling a 3.3 trillion KRW decrease.

By financial sector, household loans in the banking sector slowed in growth, while the decrease in the secondary financial sector expanded.

Household loans in the banking sector increased by a total of 4.9 trillion KRW, down 2 trillion KRW from the previous month (6.9 trillion KRW). In the banking sector, housing mortgage loans increased by 6.1 trillion KRW, with slight increases in group loans (300 billion KRW) and jeonse loans (100 billion KRW), but the increase in general individual housing mortgage loans (3.6 trillion KRW) and policy mortgages (2.1 trillion KRW) narrowed. Other loans decreased by a total of 1.3 trillion KRW, with credit loans decreasing by 1.2 trillion KRW.

In the secondary financial sector, loans decreased by a total of 2.5 trillion KRW, expanding the decrease compared to the previous month (800 billion KRW decrease). In the secondary financial sector, insurance companies increased by 300 billion KRW, but mutual finance (1.9 trillion KRW decrease) and savings banks (100 billion KRW decrease) continued to decline. Specialized credit finance companies (800 billion KRW decrease) also contributed to the decrease due to amortization effects at the end of the quarter.

The financial authorities stated, "Although the increase in household loans narrowed in September, the scale of household loans remains high, and due to seasonal moving demand in October and a base effect from the decrease in credit loans, loans may increase again. We will continue to monitor household loan trends closely," adding, "We will manage household loans stably to ensure they are supplied mainly to real demand borrowers."

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