The Bank of Korea published its April 2026 Financial Market Trends report, showing a late-month rebound in Treasury bond yields, a strong equity rally and firmer bank credit growth. Household loans rose KRW 2.1 trillion in April from KRW 0.5 trillion in March, and corporate lending increased KRW 10.7 trillion from KRW 7.8 trillion. Bank deposits fell KRW 6.8 trillion after a KRW 20.5 trillion increase in March, while funds under management at asset management companies rebounded by KRW 99.6 trillion after a KRW 29.1 trillion decline. Housing-related borrowing drove the pickup in household credit, with home mortgage loans turning from flat to a KRW 2.7 trillion increase as housing transactions and demand for intermediate payment financing rose. Other household loans fell KRW 0.6 trillion as individuals repaid loans after net stock sales. In the corporate sector, lending to small and medium-sized enterprises rose KRW 5.7 trillion on continued bank lending and demand for value-added tax payments, while large-company borrowing increased KRW 5.0 trillion as quarter-end repayments were re-lent and firms sought funds for dividends and bond redemptions. Net corporate bond issuance moved deeper into redemption at negative KRW 3.9 trillion, while commercial paper and short-term bonds recorded KRW 4.9 trillion of net issuance. On the funding side, transferable bank deposits turned to a KRW 18.8 trillion decline as corporate funds flowed out for tax and dividend payments, whereas time deposits rose KRW 4.7 trillion as some banks sought lending resources and compliance with regulatory requirements. Money market funds increased KRW 24.5 trillion and stock-type funds rose KRW 55.7 trillion, supported by the return of corporate cash and equity valuation gains. Treasury bond yields had initially fallen after the U.S.-Iran ceasefire agreement but rose again from late April, while short-term market rates declined and the KOSPI surged on semiconductor-sector strength and expectations of improved corporate earnings.
Bank of Korea2026-05-17
Bank of Korea reports faster April bank lending growth as bank deposits fall and funds under management jump KRW 99.6 trillion
The Bank of Korea’s April 2026 Financial Market Trends report shows a late-month rebound in Treasury bond yields, a strong equity rally and firmer bank credit growth, alongside a shift from bank deposits into asset management products. Household loans rose KRW 2.1 trillion, driven by housing-related borrowing, while corporate lending increased KRW 10.7 trillion amid higher funding needs for taxes, dividends and bond redemptions. Transferable deposits declined, time deposits and money market funds grew, and the KOSPI surged on semiconductor strength and improved earnings expectations.