Banks in South Korea will likely expand their lending to local companies, especially small and medium-sized enterprises in the first quarter but tighten their rules on loans to local households, a central bank poll showed Tuesday.

In a quarterly survey conducted by the Bank of Korea, the index measuring the banks' overall attitude toward fresh loans came to 4 for the January-March period, compared with negative 5 for the previous quarter.

The rise comes amid expectations for better conditions for South Korean exports following the signing of a phase one trade deal between the United States and China that many believe marks the beginning of the end of their prolonged trade conflict.

The unprecedentedly long dispute between the world's largest economies, also the biggest importers of South Korean products, had partly been blamed for a 13-consecutive month drop in South Korea's outbound shipments.

In the first 20 days of this month, Seoul's exports slipped only 0.2 percent, a great improvement from a 5.8 percent on-year drop in the entire month of January 2019.

The local banks' attitude toward fresh loans to large corporations here improved from three months earlier, rising to zero from negative 3 over the cited period, but their attitude index for smaller companies shot up to 10 from 3.

The index for home-backed loans also came to zero for the first quarter, sharply up from negative 23 in the previous quarter, when the government announced the latest in its long series of anti-speculation steps, including a complete ban on mortgages, or home-backed loans for purchases of homes, valued at more than 900 million won ($776,000).

The banks' attitude toward other household lending remained subdued for the first quarter, with the index coming to negative 7, up slightly from negative 10 three months earlier, according to the BOK.

In the survey, conducted on 199 local lenders, the respondents expected the credit risk of local households to slightly increase to 13 from 10 in the fourth quarter, with that of SMEs jumping to 27 from 20 over the cited period. (Yonhap)