South Korea’s Financial Supervisory Service published preliminary household loan data for 2025 and December 2025, showing outstanding household lending across all financial sectors increased by KRW37.6 trillion in 2025, slowing from 2024, while the balance fell by KRW1.5 trillion in December after rising in the prior month. The release also pointed to a continued decline in the household debt-to-GDP ratio, reaching 89.3 percent in Q3 2025. In 2025, mortgage loans increased by KRW52.6 trillion (4.9 percent), down from KRW58.1 trillion in 2024, while other household loans fell by KRW15.0 trillion (-2.5 percent). Bank household loans rose by KRW32.7 trillion (versus KRW46.2 trillion in 2024) and nonbank household loans increased by KRW4.8 trillion after a decline in 2024, led by mutual finance (+KRW10.5 trillion) while specialized credit finance (-KRW3.0 trillion), insurance (-KRW1.8 trillion) and savings banks (-KRW0.8 trillion) contracted. In December, bank household loans fell by KRW2.2 trillion as bank mortgage loans declined by KRW0.7 trillion and other bank loans fell by KRW1.5 trillion, while nonbank household loans rose by KRW0.7 trillion on stronger nonbank mortgage growth (+KRW2.8 trillion) despite a KRW2.1 trillion drop in other nonbank loans. For 2026, authorities indicated they will maintain a consistent household debt management stance and advised financial companies to adhere to household loan management targets from the start of the year. At a household debt management meeting referenced in the release, the Financial Services Commission introduced detailed plans to adjust housing finance rules requiring contributions to a housing finance credit guarantee fund based on housing loan issuance, with base contribution rates ranging from 0.05 percent to 0.30 percent depending on each firm’s housing loan volumes.

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