household loans-April tally
Banks' household loans snap 3-month fall in April amid high borrowing costs
SEOUL, May 11 (Yonhap) -- Household loans extended by banks in South Korea rebounded in April on increased demand for home-backed loans amid high borrowing costs caused by the central bank's monetary tightening to rein in inflation, data showed Thursday.
Banks' outstanding household loans came to 1,052.3 trillion won (US$799 billion) as of end-April, up 2.3 trillion won from a month earlier, according to the data from the Bank of Korea (BOK).
The April tally snapped a third consecutive month of an on-month decline following a 700 billion won contraction in March, a 2.8 trillion won decline in February, and a 5.8 trillion won dip in January, the sharpest monthly decline since relevant data started to be compiled in January 2004.
Banks' home-backed loans rose 2.8 trillion won on-month to 803.6 trillion won in April, while unsecured and other types of loans fell 500 billion won to 247.3 trillion won.
Mortgage loans increased thanks to increased apartment transactions and the implementation of special loans designed to help more people buy homes at lower interest rates, the BOK said.
Borrowing costs in Asia's fourth-largest economy remain high following the BOK's aggressive monetary tightening aimed at bringing surging inflation under control.
The BOK held its key rate steady at 3.5 percent last month after a rate freeze in February as inflation appears to be easing and concerns are rising over an economic slowdown.
The central bank is scheduled to hold its monetary policy meeting later this month and may face a daunting task of whether to freeze the rate again or raise it.
The bank is expected to stand pat again amid easing inflation and a slowdown in economic growth.
Last year, outstanding household loans slipped for the first time in 18 years amid higher rates.
(END)
(C) Yonhap News Agency. All Rights Reserved
