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Household credit hits fresh high in Q4 on rising mortgages

Published: 18 Feb. 2025, 16:54 Updated: 18 Feb. 2025, 17:26

A person walks by a sign about a bank's loan programs that were put up on the exterior of a lender in Seoul. [YONHAP]

Korea's household credit reached an all-time high in the fourth quarter of 2024, though its growth slowed down amid tight lending regulations, central bank data showed Tuesday.

Outstanding household credit stood at 1,927.3 trillion won ($1.32 trillion) as of end-December, up 13 trillion won from three months earlier, according to the preliminary data from the Bank of Korea (BOK).

The fourth quarter reading marked the largest since the BOK began compiling relevant data in 2002.

It also marked the third consecutive quarterly increase, though the growth slowed down from the third quarter's 18.5 trillion won rise.

For the entire year of 2024, household credit rose 2.2 percent on year, which marked the largest increase since 2021, when the figure surged 7.7 percent, the data showed.

Household credit refers to credit purchases and loans given to households by financial institutions.

Of the total, household loans stood at a record high of 1,807 trillion won at the end of December, up 10.6 trillion won from three months earlier. Credit purchases went up by 2.4 trillion won on quarter to 120.3 trillion won.

The rise in household loans came as mortgage loans increased by 11.7 trillion won during the October-December period, though the figure marked a slowdown from the previous quarter's 19.4 trillion-won rise.

Major lenders implemented tight lending rules as financial authorities sought to rein in surging household debt and rising home prices, though some of the regulations were eased at the beginning of 2025.

Other types of household loans fell 1.2 trillion won over the cited period to stand at 683.1 trillion won, the data showed.

“Household credit has trended down recently, but we will continue to closely monitor the situation as lenders have somewhat eased regulations and interest rates are forecast to be lowered,” a BOK official said.

Yonhap