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Household debt growth slows in June

All Headlines 12:00 July 12, 2017

SEOUL, July 12 (Yonhap) -- South Korea's household debt growth slowed slightly in June, data showed Wednesday, as the government moved to control fresh loans.

Household debt rose by 7.8 trillion won (US$6.8 billion) last month, down from 11.6 trillion won tallied for the same month last year, according to the data by the Financial Services Commission.

In the first half of the year, household debt grew by 40.3 trillion won, compared with an expansion of 50.4 trillion won for the same period in 2016.

The country's household debt has crimped private consumption and made it harder for the central bank to increase its key interest rate.

Compared with a month earlier, the pace of household debt also slowed, as it grew by 10 trillion won in May.

With home prices in Seoul and other areas showing signs of overheating, the government has pushed to prevent liquidity from being used for real estate speculation.

Since early this month, the lending ceiling for homes located in areas designated by the government has been lowered from 70 percent to 60 percent of the property's value. The debt-to-income ratio has also lowered to 50 percent from 60 percent.
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