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Household debt growth quickens in January despite tougher regulations

2018/02/09 12:00

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SEOUL, Feb. 9 (Yonhap) -- South Korea's household debt growth picked up last month, despite tougher regulations on mortgage loans, government data showed Friday.

Household lending by all financial institutions grew by 5 trillion won (US$4.6 billion) in January, compared with an expansion of 3 trillion won for the same month last year, according to the data by the Financial Services Commission (FSC).

In December last year, household debt grew by 6.1 trillion won.

The FSC attributed the annual growth of household debt to several one-off factors, including aggressive lending by Internet-only banks.

The government has intensified measures to tighten mortgage rules for owners of multiple homes as part of efforts to prevent mounting household debt from harming the economy.

Total household debt reached a record 1,419 trillion won in September last year.

Although there is little risk that household debt could spark a financial crisis, household debt is growing faster than household income, choking off private consumption.

In January, banks' outstanding corporate loans came to 788.6 trillion won, up 7.2 trillion won from the previous month, according to separate data from the Bank of Korea.

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angloinfo.com