The South Korea Financial Services Commission published preliminary January 2025 data showing the outstanding balance of household loans across all financial sectors fell by KRW 0.9 trillion, reversing a KRW 2.0 trillion increase in the prior month and marking the first monthly decline in ten months. Home mortgage loans increased by KRW 3.3 trillion (slightly slower than KRW 3.4 trillion previously), with growth accelerating in banks (KRW 1.7 trillion from KRW 0.8 trillion) and slowing in nonbanks (KRW 1.6 trillion from KRW 2.6 trillion). Other household loans fell by KRW 4.2 trillion, a sharper decline than the prior month (KRW 1.4 trillion), driven by a larger contraction in nonbanks (KRW 2.0 trillion from KRW 0.3 trillion). By sector, bank household loans fell by KRW 0.4 trillion, while nonbank household loans declined by KRW 0.5 trillion after rising KRW 2.4 trillion in the prior month, with mutual finance businesses and insurance companies shifting from increases to declines. The FSC linked the January decline to heightened uncertainty and seasonal factors, but noted faster growth in bank mortgage loans and steady increases in government-backed policy loans. It flagged the possibility of a rebound in February tied to housing transactions ahead of the new school year and said it will continue monitoring housing market and interest-rate conditions, including funding flows to non-Seoul regions amid rising unsold new apartment units outside the Seoul metropolitan area.

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