In September, Banks’ household loan growth slipped to an eight-month low
On Wednesday, the Bank of Korea said banks’ household loan growth slipped to an eight-month low in September and Korea’s money supply expanded at its fastest pace in five months in August. The data came ahead of the central bank’s rate-setting meeting slated for Thursday. It is amid widespread expectations that the benchmark rate would be frozen at 3.25 percent for the fourth straight month. It is due to greater risks in the global economy.
In August, a narrow measure of the money supply M2 stood at 1,719.4 trillion won ($1.46 trillion) up 4 percent from a year earlier, with bank lending keeping its solid pace. Since the 4.3 percent on-year expansion recorded in March, the August data was the fastest growth. An official at the BOK Kim Min-woo said “credit seems to have grown faster in the corporate sector in August as for M2 figures in August.”
In August, M1 rose to 5.4 percent from 3.8 percent in July. As bank lending’s growth overpowered a smaller surplus in the foreign capital outflows and current account, he country’s M2 is estimated to have grown somewhere within the low-4 percent range in September, BOK said. The recent regulator’s is move to reduce household debt. It was reflected in the banks’ loans to households.