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Demand deposits reach nearly 190 tln won in Q2

All Headlines 17:08 October 07, 2016

SEOUL, Oct. 7 (Yonhap) -- Demand deposits in South Korean banks reached nearly 190 trillion won (US$170 billion) in the April-June quarter, jumping 6.5 percent from a quarter earlier, government data showed Friday.

Demand deposits, on which banks usually pay little interest, soared by 11.5 trillion won from three months earlier to 189.5 trillion won in the second quarter that ended on June 30, as ordinary passbook account holders found few investment products that could guarantee a relatively high return, the Korea Deposit Insurance Corporation (KDIC) said in a statement.

Demand deposits reach nearly 190 tln won in Q2 - 1

The account holders appear to take a wait-and-see attitude for good investment opportunities due to all-time low interest rates. The country's key rate stands at a record low of 1.25 percent.

Most time deposits and time installment savings, which offer higher rates than demand deposits, increased in the second quarter compared to three months earlier, the KDIC said.

The data also showed that the issuance of equity-linked securities products totaled 71.9 trillion won in the second quarter, up 2.5 trillion won from a quarter earlier.

It means that some investors chose to take higher risks for higher returns. Equity-linked securities are hybrid debt securities whose return is determined by the performance of underlying equity.

entropy@yna.co.kr
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