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Household credit hits fresh high in Q2: BOK

Published: 19 Aug. 2025, 16:05

An advertisement on loans is posted outside of a bank in Seoul on Aug. 19. [NEWS1]

Korea's household credit hit a fresh high in the second quarter of this year, amid a rise in loans borrowed for real estate purchases, the central bank said Tuesday.

The outstanding credit to households stood at 1,952.8 trillion won ($1.4 trillion) as of the end of June, up 24.6 trillion won from three months earlier, according to data from the Bank of Korea (BOK).

The figure marks the highest since the fourth quarter of 2002, when the central bank started compiling such data.

It is also the steepest quarterly increase after the third quarter of 2021, when credit to households rose by 35 trillion won.

Household credit is a broad measure of household debt. It includes loans borrowed from financial institutions, such as banks and insurance companies, and unpaid outstanding balance on credit cards.

Excluding the outstanding balance on credit cards, Korea's outstanding household loans grew 23.1 trillion won from the previous quarter to 1,832.6 trillion won.

Of them, outstanding home-backed loans came to 1,148.2 trillion won at end-June, adding 14.9 trillion won from three months earlier.

"Home transactions had increased since February and pushed up the home-backed loans," the BOK said.

"Household loans had increased by 1.4 percent in the first half, which translates to an annual rate of 2.8 percent. Though the country's nominal gross domestic product [GDP] has yet to be released, we expect a slight increase in the household loans to GDP ratio."

Yonhap