SEOUL: South Korea’s household credit hit a record high in the third quarter on robust demand for mortgage loans, central bank data showed on Tuesday, reported Xinhua.

Household credit, which refers to debts owed by households to banks and other lenders in addition to the purchase on credit, came to 1,875.6 trillion won (US$1.45 trillion) at the end of September, up 14.3 trillion won (US$11.1 billion) from three months earlier, according to the Bank of Korea (BOK).

It topped the previous high of 1,871.1 trillion won (US$1.45 trillion) tallied in the third quarter of last year.

The household credit kept growing for the second straight quarter due to the offer of government-backed mortgage loans to prop up the faltering housing market.

The central bank had left its benchmark interest rate unchanged at 3.50 per cent since January, after lifting it by 3.0 percentage points for the past one and a half years.

Excluding the purchase on credit, the household debt gained 11.7 trillion won (US$9.1 billion) from three months earlier to reach a new high of 1,759.1 trillion won (US$1.36 trillion) at the end of September.

Mortgage loan to households soared 17.3 trillion won (US$13.4 billion) to hit a fresh high of 1,049.1 trillion won (US$813.5 billion), but other loans such as credit loan continued to slide for the eighth successive quarter in the July-September quarter.

The purchase on credit expanded 2.6 trillion won (US$2 billion) in the cited quarter, marking the first rebound in three quarters. -Bernama

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