March Household Loans in Financial Sector Decrease by 4.9 Trillion Won... Decline Continues for Two Consecutive Months

by Yoo Jaehoon

Published 11 Apr.2024 12:15(KST)

Last month, household loans across the entire financial sector decreased by approximately 5 trillion won, marking a decline for the second consecutive month.

According to the "Household Loan Trends for March 2024" released by the Financial Services Commission on the 11th, household loans across all financial sectors decreased by 4.9 trillion won in March. This follows a decrease of 1.9 trillion won in February, showing a continuous decline for two months.

[Image source=Yonhap News]

Mortgage loans increased by 50 billion won compared to the previous month, significantly less than the 3.7 trillion won increase in February. This is attributed to the real estate market downturn and the financial authorities' strengthened household debt management, which led banks to raise loan interest rates.

In particular, mortgage loans from commercial banks increased by 500 billion won, a much smaller increase compared to 4.7 trillion won in February. The main cause is the reduction of policy mortgages. However, individual general mortgage loans from banks increased by 4.3 trillion won.

Other loans decreased by 4.9 trillion won in March, with both the banking sector (2.1 trillion won decrease) and the secondary financial sector (2.8 trillion won decrease) showing declines. The financial authorities stated, “As high interest rates persist and the recovery of housing transactions is delayed, the decline in household loans continues,” adding, “We will closely monitor housing market and interest rate trends to ensure household loans stabilize in the long term.”