South Korean banks are seeing a surge in deposits, reflecting investors’ concerns amid growing uncertainties in the capital market, according to latest data Sunday.
Nearly 36 trillion won ($30 billion) flowed into bank deposits last month -- the largest in five years -- Bank of Korea data showed.
According to the central bank, the combined bank deposits came to nearly 1770.1 trillion won, up 35.9 trillion won from a month earlier, the biggest monthly change since Dec. 2014 (52 trillion won). About 15.2 trillion won was in short-term investments like money market funds operated by asset management companies.
This indicates that individual and institutional investors are unable to find other attractive investment outlets, the bank said.
Bank deposits include demand, transferable and time deposits along with certificate of deposit, and bank debentures. Among them, the balance of transferable deposits surpassed 704.8 trillion won with the inflow of nearly 38.6 trillion won in February.
In response to high volatility of the financial market, local firms are actively trying to secure enough funds. Last month’s net issuance of corporate bonds reached nearly 3.3 trillion won, marking the highest record since October 2019.
On Feb. 13, Korea’s stock market operator activated a circuit breaker to temporarily suspend trading on the main bourse Kospi and tech-heavy Kosdaq market after stock prices sharply declined on rising concerns over the new coronavirus outbreak.
By Choi Jae-hee (email@example.com