household loans-July tally

Banks' household loans up for 4th month in July amid housing market recovery

SEOUL, Aug. 9 (Yonhap) -- Household loans extended by banks in South Korea rose for the fourth straight month in July on increased demand for home-backed loans amid high borrowing costs, data showed Wednesday.

Banks' outstanding household loans came to 1,068.1 trillion won (US$808.9 billion) as of end-July, up 6 trillion won from a month earlier, according to the data from the Bank of Korea (BOK).

The July tally marks the fourth consecutive month of an on-month rise following a 5.8 trillion won rise in June, 4.2 trillion won increase in May and a 2.3 trillion won gain in April.

It also marks the biggest increase in 22 months following a 6.4 trillion won jump in September 2022.

Banks' home-backed loans rose 6 trillion won on-month to 820.8 trillion won in July, while unsecured and other types of loans fell 10 billion won to 246.1 trillion won over the cited period, according to the data.

Borrowing costs in Asia's fourth-largest economy remain high following the BOK's aggressive monetary tightening aimed at bringing surging inflation under control.

In July, the BOK kept its benchmark rate unchanged at 3.5 percent, the fourth straight month of a rate freeze in the face of a murky growth outlook and moderating inflation.

The rate freezes came after the BOK had delivered seven consecutive hikes in borrowing costs since April last year.

Last year, outstanding household loans slipped for the first time in 18 years amid higher rates.

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