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184234
Wed, 05/25/2011 - 07:52
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https://oananews.org//node/184234
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S. Korea's household credit tops 800 tln won in Q1
SEOUL (Yonhap) - South Korea's household credit exceeded the 800 trillion won (US$731.7 billion) mark for the first time in the first quarter on a rise in bank home-backed lending, but the growth pace slowed due to seasonal factors, the central bank said Wednesday.
As of the end of March, outstanding household credit stood at 801.4 trillion won, up 6 trillion won from three months earlier, according to the Bank of Korea (BOK).
The first-quarter reading sharply slowed from a 25.3 trillion won expansion registered in the fourth quarter of last year and marked the slowest growth since the first quarter of 2010.
Household credit refers to credit purchases and loans for households extended by financial institutions, including commercial lenders and mutual savings banks.
"The growth pace of household credit eased due to seasonal factors, indicating that demand for home-backed loans slowed in January and February amid sluggish property transactions," a BOK official said.
Despite the eased growth, the country's household credit surpassed the 800 trillion won mark for the first time in the January-March period, spanning concerns about rising household debt.
Household lending by local financial institutions reached 752.3 trillion won as of end-March, up 6.3 trillion won from the preceding quarter. The first-quarter data slowed from a 20.9 trillion won gain in the fourth quarter of 2010, the BOK added.
In the first quarter, banks' home-backed lending, which accounts for a majority of banks' loans, grew by 5.4 trillion won on-quarter to 289.9 trillion won, it added.
Credit purchases stood at 49.1 trillion won as of end-March, down 300 billion won from the preceding quarter.
The data came as the BOK froze the key interest rate at 3 percent for the second consecutive month in May due to economic uncertainty.
Households' mounting debt is cause for concern because their capacity to service debt would be dented as interest rates rise.
The central bank has raised borrowing costs four times from a record low of 2 percent since last July in an effort to normalize its loose monetary policy stance and tame inflation.
As of the end of March, outstanding household credit stood at 801.4 trillion won, up 6 trillion won from three months earlier, according to the Bank of Korea (BOK).
The first-quarter reading sharply slowed from a 25.3 trillion won expansion registered in the fourth quarter of last year and marked the slowest growth since the first quarter of 2010.
Household credit refers to credit purchases and loans for households extended by financial institutions, including commercial lenders and mutual savings banks.
"The growth pace of household credit eased due to seasonal factors, indicating that demand for home-backed loans slowed in January and February amid sluggish property transactions," a BOK official said.
Despite the eased growth, the country's household credit surpassed the 800 trillion won mark for the first time in the January-March period, spanning concerns about rising household debt.
Household lending by local financial institutions reached 752.3 trillion won as of end-March, up 6.3 trillion won from the preceding quarter. The first-quarter data slowed from a 20.9 trillion won gain in the fourth quarter of 2010, the BOK added.
In the first quarter, banks' home-backed lending, which accounts for a majority of banks' loans, grew by 5.4 trillion won on-quarter to 289.9 trillion won, it added.
Credit purchases stood at 49.1 trillion won as of end-March, down 300 billion won from the preceding quarter.
The data came as the BOK froze the key interest rate at 3 percent for the second consecutive month in May due to economic uncertainty.
Households' mounting debt is cause for concern because their capacity to service debt would be dented as interest rates rise.
The central bank has raised borrowing costs four times from a record low of 2 percent since last July in an effort to normalize its loose monetary policy stance and tame inflation.
