Early Withdrawals from Savings and Time Deposits by Individuals at Top 5 Banks Exceed 3.07 Million Cases in First Half... 51 Trillion Won Outflow

Early Withdrawals Surge at Five Major Banks
Up 11.39% from 2.76 Million Cases Last Year
Early Withdrawal Amounts Jump 33.31%
Driven by Money Movement into the Stock Market

In the first half of this year (January to June), the number of early withdrawals from savings and installment deposit accounts by individual customers at the five major commercial banks (KB Kookmin, Shinhan, Hana, Woori, and NH Nonghyup) exceeded 3.07 million, up more than 11% compared to the same period last year. This is believed to have been influenced by the ongoing “money move” from banks to the stock market, which accelerated starting in the fourth quarter of last year.

According to the financial sector on July 14, the number of early withdrawals from deposits and installment savings by individual customers of the five major banks in the first half of this year was 3,077,529, representing an 11.39% increase from the same period last year (2,762,754 cases).

Early withdrawals from installment savings rose only 2.18% to 1,721,981 in the first half of this year, compared to 1,685,248 in the same period last year. In contrast, early withdrawals from deposit accounts surged 25.8%, from 1,077,506 cases last year to 1,355,548 this year.

The total amount of early withdrawals from deposits and installment savings in the first half of this year reached 51.17172 trillion won, a sharp increase of 33.31% from 38.38535 trillion won during the same period last year.

The amount of early withdrawals from deposit accounts rose 33.5% compared to the first half of last year, from 34.28164 trillion won to 45.76865 trillion won. Early withdrawals from installment savings accounts also grew by 31.7%, rising from 4.10371 trillion won in the first half of last year to 5.40307 trillion won this year.

The continued increase in early withdrawals from deposit and savings accounts up to the first quarter of this year is largely attributed to the stock market “money move” that picked up speed starting in October last year. The five major banks recorded monthly early withdrawals in the 400,000 range from January through September last year. However, with the KOSPI index surpassing 4,000 in October last year, the figure increased to 510,000 cases, and with the exception of April this year (430,856 cases), the number exceeded 500,000 cases every month through last month.

The amount of early withdrawals from deposits and savings accounts was generally between 5 trillion and 6 trillion won per month from January to September last year, but rose to around 7.8 trillion won in October last year. In November, it soared to 9.5 trillion won, followed by 9.8 trillion won in December and 9.6 trillion won in January this year, staying above 9 trillion won for three consecutive months. The figures for February and March were 8.4 trillion won and 8.5 trillion won, respectively.

The scale of early withdrawals during the second quarter was somewhat smaller than in the first quarter. As the KOSPI recovered from the aftermath of the Middle East war, early withdrawals stood at 7.2 trillion won in April, 9 trillion won in May, and 8.5 trillion won last month. While these figures remain higher than those seen in the first half of last year, they were lower than those recorded in the first quarter of this year.

The banking industry believes that the slight slowdown in deposit and savings withdrawals in the second quarter is due to increased volatility in the KOSPI, which had been on an upward trend since last year.

A banking industry official said, “Before the outbreak of the Middle East war, the KOSPI was steadily rising—so much so that it seemed to go up every morning when you woke up, leading to a widespread belief that deposits and savings offering annual rates of 3% to 4% were pointless. As the stock market experienced repeated surges and corrections in the second quarter, the desire to hold cash has grown, which is believed to have led to a slight decrease in early withdrawals.”

This content was produced with the assistance of AI translation services.