Friday, November 22nd, 2013
SEOUL, KOREA - Korea's household debt rose 12 trillion won in three months to almost 1,000 trillion won. Although the volume of debt with the primary banking sector declined slightly, the debt level with secondary banks such as savings banks has more than offset the shortfall.
According to data "3Q 2013 Household Credit (Preliminary)" published by the Bank of Korea on November 21, the debt held by consumers as of the end of September was 991.7 trillion won, up 12.1 trillion won from the end of June.
Household debt is defined as the sum of loans outstanding made out to consumers and credit sales (credit card purchase). The household debt volume dipped in March this year to 963.1 trillion won from 963.8 trillion won in December 2012, the lowest level since the 2008 global financial crisis. But the amount has since increased at a fast clip.
A Bank of Korea official said that the level rose largely because student loans for the Fall semester and secondary banking sector loans increased despite a fall in home mortgages after the expiration of sales tax exemption for home purchases. Analysts expect that the volume will definitely break the 1,000-trillion-won level by the year's end.
