South Korea Financial Supervisory Service reports May household loans rose KRW9.3 trillion and outlines tighter monitoring

The South Korea Financial Supervisory Service published preliminary data showing outstanding household loans across all financial sectors rose KRW9.3 trillion in May 2026, up from KRW3.5 trillion in April. Overall growth accelerated even though home-backed mortgage loans slowed to KRW4.0 trillion from KRW5.5 trillion, because other lending rebounded to KRW5.3 trillion from a KRW2.0 trillion decline. Credit loans drove much of that swing, turning to a KRW3.4 trillion increase from a KRW0.9 trillion fall. By sector, banks accounted for KRW6.9 trillion of the increase, compared with KRW2.1 trillion in April. Banks' own mortgage loans accelerated to KRW2.1 trillion, while policy-based mortgage loans slowed to KRW1.1 trillion and other bank lending turned positive at KRW3.7 trillion after a KRW0.6 trillion decline. Nonbank household loans rose KRW2.3 trillion, up from KRW1.4 trillion, with slower growth in mutual finance businesses partly offset by rebounds at insurance companies, specialized credit finance businesses and savings banks. The release linked the pickup in other loans to increased demand during the family month and stronger stock market investment. Financial companies were urged to keep strictly to their household loan management targets as both credit loans and mortgage loans could accelerate further in coming months. The banking sector plans to tighten credit lending to high-income earners by lowering maximum loan limits and offering exemptions from early repayment fees. Financial authorities also plan weekly inspection meetings to check household debt management targets and may introduce additional policy tools if needed.