The Bank of Korea’s financial market review showed that Treasury bond yields rose substantially in August amid higher oil prices following renewed Middle East tensions, changing domestic and foreign monetary policy expectations and rising long-term government bond yields in major economies. Major three-month market rates also increased following a Base Rate hike. The KOSPI fluctuated with expectations for the artificial intelligence and semiconductor industries before recovering toward the 7,000 level in September as U.S. technology stocks strengthened. Bank household lending increased by KRW 3.4 trillion, down from KRW 5.5 trillion in July, as other loans fell by KRW 0.6 trillion because of slower retail stock investment and tighter bank management of unsecured credit. Mortgage lending accelerated to KRW 4 trillion, supported by housing transactions and new occupancies in the Seoul metropolitan area. Corporate lending rose by KRW 9.7 trillion, with stronger growth for both large companies and small and medium-sized enterprises, while corporate bonds remained in net redemption. Bank deposits edged up by KRW 0.1 trillion after a KRW 30 trillion decline, and funds managed by asset management companies increased by KRW 23.5 trillion, led by stock funds.
2026-09-09Bank of Korea
Bank of Korea reports rising bond yields, slower household loan growth and stronger corporate lending in August
The Bank of Korea reported substantially higher bond yields and short-term market rates in August, while the KOSPI recovered toward 7,000 in September. Household loan growth slowed to KRW 3.4 trillion despite faster mortgage lending, while corporate loans increased by KRW 9.7 trillion. Bank and asset management company deposits returned to growth.