Household Loans at Five Major Banks Increase by Over 4 Trillion Won for Second Consecutive Month

Both Mortgage and Credit Loans Expand

35 Trillion Won Flows into Time Deposits

Household loans at the five major domestic commercial banks have increased by more than 4 trillion won for two consecutive months. Despite efforts by financial authorities and the banking sector to control the aggregate volume of household loans, expectations of rising home prices have led to the largest increase in mortgage loans in 11 months. In addition, demand for investor funds amid heightened stock market volatility has pushed credit loans up by more than 1 trillion won.

Yonhap News Agency

According to the financial sector on August 3, the outstanding balance of household loans at KB Kookmin, Shinhan, Hana, Woori, and NH Nonghyup Bank stood at 778.9791 trillion won at the end of last month. This represents an increase of 4.0183 trillion won from the end of June. While the pace of increase slowed slightly compared to the previous month, this marks the second consecutive month with an increase of over 4 trillion won.

This upward trend in household loans was led by home mortgage loans. The outstanding balance of mortgage loans at the five banks amounted to 617.9411 trillion won, rising by 2.7955 trillion won in one month. This marks four consecutive months of growth, and it is the largest monthly increase in 11 months, since August 2025's rise of 3.7012 trillion won.

Even though the financial authorities have set annual targets for each bank regarding the growth of household loans, and banks are adjusting loan limits and volumes, demand for housing purchases has continued in key areas such as Seoul and the surrounding metropolitan region. Concerns about housing supply shortages and expectations of rising home prices are converging, resulting in persistent demand for home purchases despite loan regulations. Group loans have also increased. At the end of last month, the outstanding balance of group loans—including final payment loans, relocation loans, and interim payment loans—at the five major banks was 148.2426 trillion won, up by 653.1 billion won from the previous month.

The outstanding balance of personal credit loans, including revolving credit accounts, also increased by 1.0829 trillion won compared to the previous month, reaching 109.7533 trillion won. Analysts attribute this inflow of loan demand to investors who saw stock price declines amid both domestic and international market volatility as buying opportunities.

In the deposit market, funds moved en masse from demand deposits to time deposits. The outstanding balance of time deposits at the five major banks was 984.9399 trillion won at the end of last month, an increase of 35.5401 trillion won in one month. This is the largest monthly increase since October 2022, when it rose by 47.7231 trillion won. In contrast, the balance of demand deposits—including passbook savings and money market deposit accounts (MMDA)—declined by 56.4049 trillion won from the previous month to 665.8879 trillion won. This is the largest monthly decline since combined statistics for the five major banks began in January 2019. As stock market volatility has expanded, a portion of idle funds appears to have shifted to relatively stable time deposits.

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