South Korea's household loans jumped 12 percent last year from a year earlier as people borrowed more from financial institutions to buy homes and invest in businesses, the central bank said Wednesday.
The outstanding loans extended to households came to 1,154.6 trillion won ($1.01 trillion) as of the end of December last year, compared with 1,030.6 trillion won from a year earlier, the Bank of Korea said in a report submitted to the parliament.
(Yonhap)
South Korean officials view an increase in household loans as a potential risk factor as household debt could weigh on private consumption and financial stability.
Outstanding corporate loans extended by banks stood at 753.9 trillion won as of the end of December, up 20.8 trillion won from a year earlier.
In comparison, outstanding corporate loans extended by banks jumped by 48.3 trillion won in 2015 from a year earlier.
The BOK said a business slump and corporate restructuring are to blame for a slowdown of the annual growth rate for corporate loans.
The BOK reiterated its stance that it will keep the current monetary easing policy while paying attention to financial stability.
The BOK left its key rate unchanged at an all-time low of 1.25 percent in January after sending the rate to the lowest level in June to support the growth of Asia's fourth-biggest economy.
The BOK also said it will closely monitor uncertainties at home and abroad and the pace of US rate hike as well as household debt.
In December, the US Federal Reserve raised its key interest rate by a quarter of a percentage point to a range of 0.5 percent to 0.75 percent. It also signaled three rate hikes in 2017. (Yonhap)
