SEOUL– Household loans by major banks in South Korea grew at a slower pace in October from a month earlier as the government tightened its grip on lending, industry data showed Monday.
The combined outstanding loans of five major banks, including KB Kookmin, Shinhan, Hana and Woori, came in at 706.33 trillion won (US$600.4 billion) as of end-October, up 3.44 trillion won from late September, according to the data by the banks.
The growth slowed from a 4.07 trillion won on-month rise tallied in September.
Their outstanding home-backed loans also expanded at a slower pace over the same period.
The data showed that their combined mortgage loans stood at 501.22 trillion won at the end of October, up 3.8 trillion won from a month earlier. The increase compared with a 4 trillion won on-month rise registered in September.
The slower pace of growth came as South Korea beefed up its regulation of household debt amid worries excessive lending could weigh on economic recovery.
In the latest in a string of such measures, the government announced last week that it will enforce stricter lending rules based on borrowers’ repayment capability through the debt service ratio from January next year to curb soaring household debt.
The government said that it will work hard to keep the annual household debt growth rate in the 5-6 percent range for this year and lower it to the 4-5 percent range for next year.
Source: Yonhap News Agency