Korea's household credit increased by the most in three years in the third quarter of the year as home-backed loans continued to jump in the face of tightened lending criteria and high rates, central bank data showed Tuesday.
Outstanding household credit reached 1,913.8 trillion won ($1.372 trillion) at the end of September, up 18 trillion won from three months earlier, according to the preliminary data from the Bank of Korea (BOK).
The third-quarter growth marks a rise for the second consecutive quarter after the 13.4 trillion won advance in the April-July period and the sharpest gain since the third quarter in 2021, according to the data.
Household credit refers to credit purchases and loans given to households by financial institutions.
The rise in household loans came despite high borrowing costs, driven by the BOK's series of interest rate hikes to bring inflation under control, and tightened lending criteria.
Of the total, household loans stood at a record high of 1,795.8 trillion won at the end of September, up 16 trillion won from three months earlier. The third-quarter gain also marks the largest in three years.
Mortgage loans increased by 19.4 trillion won during the third quarter of the year, accelerating from the previous quarter's 16 trillion won rise, and other types of household loans fell 3.4 trillion won over the cited period, compared with the previous quarter's 2.7 trillion won slip.
Last month, the country's central bank slashed its key rate by a quarter percentage point to 3.25 percent amid moderating inflation and slackening domestic demand.
The BOK delivered seven consecutive rate hikes from April 2022 to January 2023. (Yonhap)
Source: Koreatimes
