Five Major Banks Exceed Revised Household Loan Targets; Lending Restrictions Continue

[Financial News] Major commercial banks have already exceeded the annual growth targets they newly established in consultation with financial authorities, it has been confirmed.
According to financial sector sources on the 22nd, the household loan balance excluding policy loans at the five major banks—KB Kookmin Bank, Shinhan Bank, Hana Bank, Woori Bank and Nonghyup Bank—stood at KRW 652.2617 trillion as of the 17th.
This represented an increase of KRW 7.2918 trillion from KRW 644.97 trillion at the end of last year.
The banks had agreed with financial authorities last month to set their capacity for new lending at KRW 2.78 trillion, but that amount has also been exhausted.
Two of the five major banks exceeded their annual targets by a wide margin, while two others were nearing theirs.
However, the total household loan balance at the five banks, including policy loans, stood at KRW 781.0582 trillion as of the 17th, down KRW 611 billion from KRW 782.1192 trillion at the end of August.
This was the first decline in the total household loan balance in six months, since March.
As a result, total household loan balances declined as policy loans fell. However, the banks' own household lending excluding policy loans remained on an upward trend, analysts said. Bank-specific lending restrictions, including monthly aggregate lending management, are therefore expected to continue.
Analysts also say that loan supply to genuine end-user borrowers is unlikely to face major disruptions. Demand for new mortgages typically declines toward the end of the year, while relocation expense loans, interim-payment loans and final-payment loans are excluded from aggregate lending management.

[email protected] Seo Ji-yoon Reporter