South Korean banks to further ease lending in Q3: report
Household loan growth has slowed as borrowing costs rose, according to Yonhap.
Banks in South Korea are expected to further ease lending in the third quarter, even as credit risks are expected to rise, reports Yonhap, based on a survey conducted by the Bank of Korea (BOK).
An index gauging banks’ attitude toward home-backed loans and unsecured household lending stood at 14 and 19, respectively, for the July-September period, according to the findings of a poll of officials handling credit affairs at financial institutions (FIs)—which include 18 banks.
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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South Korea’s household debt saw its growth slow recently amidst tightened lending rules and rising borrowing costs, according to local reports.
Household loans extended by local banks grew only 2.8% year-on-year in April, a sharp decline from January’s 6.2% rise, according to official data.
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Part of this has to do with rising rates, with the central bank raising the rate five times since August last year to 1.75%. The fast-rising borrowing costs have led to increased worries over credit risks for households.