Last month, the balance of resident foreign currency deposits increased by more than $5 billion, continuing its upward trend for the second consecutive month. This was influenced by the deposits of foreign investment funds and dividends from overseas subsidiaries in U.S. dollars, Chinese yuan, and Japanese yen.
According to a Bank of Korea announcement on the 23rd, the balance of resident foreign currency deposits at foreign exchange banks at the end of last month was recorded at $106.44 billion, an increase of $5.08 billion compared to the previous month. Resident foreign currency deposits refer to the domestic foreign currency deposits of Korean nationals, domestic corporations, foreigners residing in Korea for more than six months, and foreign corporations operating in Korea.
Resident foreign currency deposits decreased from February this year (-$4.91 billion) to April (-$680 million), then turned to an increase in May (+$5.1 billion). Since then, they have increased for two consecutive months up to last month.
By currency type, the U.S. dollar balance ($89.14 billion) increased by $3.6 billion. In particular, corporate deposits (+$3.24 billion) accounted for most of the increase. The Bank of Korea explained that the rise in dollar deposits was due to some corporations' deposits of current transaction funds and the temporary deposits of foreign investment funds.
Other currencies also saw an increase in deposit amounts. Deposits in Chinese yuan and Japanese yen increased by $1.1 billion and $260 million, respectively, due to the increase in dividends deposited by overseas subsidiaries to their domestic parent companies. The deposit balances are $2.07 billion and $8.69 billion, respectively. Euro deposits increased by $120 million to $5.21 billion.
By entity, corporate deposits increased by $4.66 billion, while individual deposits rose by $420 million. The balances at the end of June were $91.67 billion and $14.77 billion, respectively.