Household loans rise unabated

[THE INVESTOR] Home-backed loans increased by the largest margin this year in July, fueling concerns about household debt that continues to grow despite government efforts.

According to the data released by the Bank of Korea on Wednesday, home-backed loans taken out from banks rose 5.8 trillion won ($5.30 billion) in July to come in at 506.6 trillion won.

Household loans in general rose 6.3 trillion won from June to come in at 673.7 trillion won, the BOK said.

The BOK attributed the rise in home-backed loans to the increase in residential property market, and the fall in interest rates. The number of homes traded in Seoul in July came to 14,000 units, up 2,000 units from June.

In addition to household loans, corporate loans also rose in June, rising 6.1 trillion won compared to the previous month. Loans taken out by small and medium enterprises spiked by 5.5 trillion won.

Of the loans taken out by SMEs, those taken out by self-employed people came to 251.6 trillion won, rising above the 250 trillion won mark for the first time.

By Choi He-suk (cheesuk@heraldcorp.com)