Photo by Tori Song.

Banks in South Korea to maintain eased stance in extending loans: report

Increased lending capacity and intensifying competition encourage banks.

Banks in South Korea are expected to maintain an eased stance in extending loans in Q1, reports Yonhap, based on a poll conducted by the Bank of Korea.

The lenders’ increased lending capacity and intensifying competition to profit off loans will drive this attitude, the BOK said.

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According to the poll, which included 18 banks, the index gauging banks' lending attitude toward households and businesses stood at 13 for the first quarter period.

A reading above zero means the number of lenders that will ease lending surpasses that of banks planning to tighten lending criteria.

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However, the BOK warned that the credit risks for borrowers in the first quarter will also likely increase due to a rising debt burden from high borrowing costs.

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