Household Loans Increased by 10.1 Trillion Last Year... Mortgage Loans Up by 45.1 Trillion

"Increased Focus on Policy Funds Centered on Actual Demand"

Last year, household loans across the entire financial sector increased by approximately 10 trillion won compared to the previous year. While other loans decreased by 35 trillion won, housing mortgage loans led the growth trend by increasing by more than 45 trillion won due to the influence of policy mortgages.

The Financial Services Commission announced on the 10th that household loans across the entire financial sector increased by 10.1 trillion won (0.6%) compared to the end of the previous year. The amount of household loan increases peaked at 56.2 trillion won in 2019, 112.3 trillion won in 2020, and 107.5 trillion won in 2021, then decreased to -8.8 trillion won in 2022, but returned to a net increase after one year.

Apartment viewed from Namsan, Jung-gu, Seoul on the 5th. Photo by Jinhyung Kang aymsdream@

By loan type, housing mortgage loans increased by 45.1 trillion won mainly in the banking sector. This is about 1.6 times the total increase of 27 trillion won in the previous year. On the other hand, other loans decreased by 35 trillion won, showing a similar trend to the previous year's decrease of 35.8 trillion won.

By financial sector, household loans in the banking sector increased by 37.1 trillion won, nearly 38 trillion won more compared to the previous year (-2.8 trillion won). However, the authorities analyzed that this is still a stable situation compared to the average of the past eight years (62.1 trillion won). Household loans in the secondary financial sector decreased by 27 trillion won, significantly expanding the decrease compared to the previous year (-6 trillion won).

Housing mortgage loans in the banking sector increased by 51.6 trillion won, expanding the increase compared to the previous year (20 trillion won), but still did not reach the average of the past eight years (49 trillion won). Other loans in the banking sector decreased by 14.5 trillion won, continuing the downward trend, but the decrease was smaller compared to the previous year (-22.8 trillion won).

In the secondary financial sector, household loans increased by 2.8 trillion won in insurance companies, but decreased in mutual finance (-27.6 trillion won), savings banks (-1.3 trillion won), and specialized credit finance companies (-900 billion won).

An official from the financial authorities stated, "In 2023, household loans turned to an increase due to the recovery of the housing market, but most of the increase was centered on policy funds for actual demand, and the increase was managed stably compared to previous years. However, since the household debt ratio relative to gross domestic product (GDP) remains high, we will steadily implement previously announced tasks such as the phased introduction of the stress Debt Service Ratio (DSR) throughout the year to induce the establishment of lending practices based on borrowers' debt repayment ability."

Meanwhile, household loans across the entire financial sector increased by only 200 billion won last month, sharply slowing down compared to the previous month (2.6 trillion won). Housing mortgage loans increased by 5.1 trillion won, reducing the increase compared to the previous month (5.6 trillion won). Other loans decreased by 4.9 trillion won, expanding the decrease compared to the previous month (-3 trillion won).

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