Banks have recently started managing household loans not only monthly as requested by financial authorities but also daily on their own. In the case of non-face-to-face dwelling loans, there has been a rapid depletion of daily targets as soon as business starts, leading to a phenomenon of 'loan shutdown' since the beginning of the year.
According to the financial sector on the 4th, Kwon Dae-young, Secretary-General of the Financial Services Commission, noted in a briefing on household debt on the 27th of last month that the target for household loans from banks is expected to increase by about 1% to 2% compared to last year. Banks are expected to continue a passive loan operation approach if the increase in the household loan target is limited to around 1%. With the financial authorities' management of household loans tightening this year as well, banks have been implementing 'monthly household loan management' as required by authorities last year. This is the reason for not being able to actively pursue loan operations since the beginning of the year.
In fact, banks are managing their own daily household loan targets beyond the monthly. The application acceptance for Hanabank's non-face-to-face dwelling loan product, 'Hana OneQ Mortgage Loan,' has been closing as soon as business starts at 9 a.m. recently. Hanabank has set a daily sales limit for this non-face-to-face product. The 'iM Mortgage Loan,' a non-face-to-face flagship product of iM Bank, also has a limit on the number of applications per day, often running out as soon as business begins.
A representative from a commercial bank said, "In the case of non-face-to-face products, it's difficult to control once the lending begins, so we have no choice but to set the limits tighter and lower. On the other hand, offline loans are not at a level where they can’t be obtained, even if they run out like non-face-to-face products."
Given the situation, banks are not opting to lower loan interest rates to drive business as they did in previous years. While Woori Bank reduced the additional charge on its five-year variable-rate dwelling loan product by 0.25 percentage points starting from the 28th of last month, it is viewed as an effort to match rates with other banks, considering that Woori Bank’s average household loan interest rate rose by 1.13 percentage points to 5% from September to December last year.
As the demand for dwelling loans suppressed since last year concentrates at the beginning of this year, there is a concern that the household loan target may run out quickly, similar to last year. Financial authorities have continued to impose penalties on banks that exceed household loan targets and have shown a commitment to preventing a 'loan cliff' situation.
A source from the banking sector said, "The 1% to 2% increase in the household loan target mentioned by the financial authorities is not a significant increase, so there are many variables to consider before acting aggressively. We need to adjust from the beginning of the year to avoid a situation similar to last year, where we suddenly couldn't operate much by the end of the year."