South Korea Household Debt Hits USD772.9B
Total household debt held by deposit-taking banks reached 1,181.8 trillion won ($772.9 billion) at the end of May, marking an increase of 6.9 trillion won from the previous month, according to the Bank of Korea (BOK). The figure represented a significant jump from April's 2.1 trillion won expansion, extending an unbroken upward trend for a third consecutive month.
Mortgage lending climbed 3.2 trillion won in May, buoyed by firmer activity in the housing market. Apartment transactions across the country have remained elevated in recent months, registering 48,000 units in January, 41,000 in February, and 49,000 in both March and April, reflecting a fluctuating but broadly active real estate environment.
Other household loan categories — encompassing credit loans, credit lines, and commercial real estate-backed lending — rose a combined 3.7 trillion won over the same period.
On the corporate side, bank lending to businesses reached 1,408.3 trillion won at end-May, up 10.6 trillion won month-on-month. Loans to large companies grew by 5.2 trillion won, while lending to small firms expanded by 5.4 trillion won.
The BOK held its benchmark interest rate steady at 2.50 percent for an eighth consecutive time in May. However, the central bank signaled the possibility of rate hikes later this year, pointing to improving economic growth, mounting inflationary pressures, rising household debt risks, and persistent exchange rate volatility as key factors informing its outlook.
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