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South Korea’s household debt hit a record high in the third quarter

Seoul, November 24 (Xinhua)-Korea’s household debt hit a record high in the third quarter as the COVID-19 pandemic increased demand for credit loans amid record low interest rates. Central bank data showed on Tuesday.

According to the Bank of Korea (BOK), household credit was 1682.1 trillion won (US $ 1.5 trillion) as of the end of September, the highest since data collection began in the fourth quarter of 2002.

It increased by 44.9 trillion won from three months ago, recording the second largest increase every quarter.

Household credit refers to the debt that households owe to banks, insurance companies, and other financial institutions, and credit purchases.

Mortgages increased by 17.4 trillion won from three months ago to 890.4 trillion won at the end of September.

It was the largest quarterly expansion since the fourth quarter of 2016, as borrowing costs hit record lows.

After lowering 50 basis points in March, BOK lowered its target interest rate by 25 basis points in May to a record low of 0.50%.

Other credits, including credit loans, increased by 22.1 trillion won to 695.2 trillion won during the citation period.

This was the largest quarterly growth, more than doubling the increase of 9.4 trillion won in the second quarter as households rushed to borrow money during the recession caused by the COVID-19 pandemic.

Credit purchases from July to September increased by 5.4 trillion won to 96.6 trillion won. (1 US dollar is equivalent to 1,111.45 won)

South Korea’s household debt hit a record high in the third quarter

Source link South Korea’s household debt hit a record high in the third quarter

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