Last month's increase in banks' mortgage loan growth narrowed from the previous month. The change reflects tighter management of household loans by banks after the Oct. 15 measures.
According to the Nov. financial market trends released by the Bank of Korea (BOK) on the 10th, last month's outstanding household loans at banks came to 1,175.6 trillion won, up 1.9 trillion won from the previous month. The increase narrowed by 1.6 trillion won from the previous month's 3.5 trillion won.
Within household loans, the outstanding balance of mortgage loan rose 700 billion won from the previous month to 935.5 trillion won. The increase was smaller than the previous month's 2 trillion won. Jeonse deposit loans included in mortgage loan fell by 300 billion won last month, declining for a third straight month.
Park Min-cheol, Bank of Korea (BOK) market coordination team Vice Minister, said, "We thought the increase in housing transactions ahead of the Oct. 15 measures would start to show this month, but banks tightened their management of household loans, limiting the growth."
By contrast, other loans including unsecured loans increased by 1.2 trillion won, widening from October's +1.4 trillion won. The outstanding loan balance rose for the second straight month. The Bank of Korea (BOK) said other loans increased mainly in unsecured loans due to expanded domestic and overseas stock investments.
Corporate loans increased by 6.2 trillion won to 1,372.2 trillion won last month. The increase widened from the previous month's 5.9 trillion won. By size, loans to large corporations rose 2.4 trillion won, and loans to small and midsize enterprises increased 3.8 trillion won. For large corporations, the growth widened due to banks strengthening sales efforts in the corporate sector and some companies' facility investment demand, while for small and midsize enterprises, it narrowed due to banks' management of regulatory ratios.
Banks' outstanding deposits increased by 36.6 trillion won to 2,527 trillion won. The increase was the largest on record for November. Demand deposits rose 15.2 trillion won, and time deposits increased 4.5 trillion won. Bank bonds rose 12 trillion won as demand increased to secure lending resources and manage the liquidity coverage ratio (LCR).
Asset management company receipts increased by 9.7 trillion won to 1,286.9 trillion won. Money market funds (MMFs) fell by 100 billion won, turning to a decline, while equity funds (+6.9 trillion won) and other funds (+8.7 trillion won) maintained gains. Bond funds (-6.3 trillion won) also turned to a decline.