As banks tighten regulations on household loans, insurers are suspending or restricting the supply of mortgage loan products in succession. As loan demand shifts to nonbank institutions, a "balloon effect" is quickly spreading across the secondary financial sector.
According to the financial sector on the 3rd, Samsung Fire & Marine Insurance has completely halted new applications for mortgage loan products through the end of this month. Previously, it limited applications mainly at some branches, but as demand surged recently and the loan limit was quickly exhausted, it imposed a full suspension at the headquarters level. Both offline applications through loan consultants and non-face-to-face applications via the Monimo app are currently stopped. A notice has been posted on the Monimo app stating that the service will be inspected through the 31st of this month.
Samsung Fire & Marine Insurance raised the rate on five-year fixed-rate home mortgage loans by 0.4 percentage points on the 23rd of last month to curb demand, but applications continued to pour in, and it ultimately stopped new originations. A company official said, "We suspended applications due to the loan limit being exhausted."
Samsung Life Insurance also suspended non-face-to-face home mortgage applications via the Monimo app through the end of Aug. However, it said this is a measure due to system improvements, and applications are still possible through the call center and in-person counters. Hanwha Life Insurance has also halted new home mortgage originations since late last month.
Analysts say this trend largely reflects demand shifting due to tighter bank regulations. In fact, the outstanding household loans of the five major banks (KB Kookmin, Shinhan, Hana, Woori, and NH Nonghyup) reached 774.9608 trillion won last month, up 4.1378 trillion won from the previous month, marking the largest increase since July last year.