In August 2026, the outstanding balance of household loans across all financial sectors increased KRW2.6 trillion (preliminary), growing at a slower pace compared with the previous month (up KRW6.4 trillion).

(By Type)  Home-backed mortgage loans increased KRW4.3 trillion, which showed a slowing down from the previous month (up KRW3.6 trillion). Banks (up KRW3.5 trillion → up KRW4.0 trillion) and nonbanks (up KRW0.1 trillion → up KRW0.3 trillion) both saw the pace of growth accelerating.

Other types of loans edged down KRW1.7 trillion, shifting back down from a growth of KRW2.8 trillion in the previous month with credit loans falling KRW0.5 trillion from an increase of KRW2.1 trillion a month ago.

(By Sector)  In August 2026, household loans in the banking sector went up KRW3.4 trillion, growing at a slower pace from the previous month (up KRW5.5 trillion). Banks’ own mortgage loans (up KRW2.5 trillion → up KRW2.9 trillion) and policy-based mortgage loans (up KRW1.0 trillion → up KRW1.1 trillion) both edged up at faster rates, while other types of loans shifted back down from the previous month’s growth (up KRW2.0 trillion → down KRW0.6 trillion).

The nonbanking sector saw household loans declining KRW0.8 trillion, turning back lower from a growth of KRW0.9 trillion in the previous month. Mutual finance businesses (down KRW0.6 trillion → down KRW0.5 trillion) saw the pace of decline slowing down, while savings banks (up KRW0.5 trillion → up KRW0.3 trillion) saw the pace of growth decelerating. Insurance businesses (up KRW0.7 trillion → down KRW0.3 trillion) and specialized credit finance businesses (up KRW0.3 trillion → down KRW0.3 trillion) saw household loans shifting back down from increases seen in the previous month.

(Assessment)  In August 2026, mortgage loans (up KRW3.6 trillion → up KRW4.3 trillion) expanded at a faster pace from the previous month as the previously increased volume of housing transactions for new housing occupants in July and August appears to have pushed up the volume of balance payments on housing transactions. However, other types of loans (up KRW2.8 trillion → down KRW1.7 trillion) including credit loans shifted back down for the first time in four months, which helped to slow down the overall pace of household loan growth in August (up KRW6.4 trillion → up KRW2.6 trillion) compared with a month ago.

However, it is possible to see the pace of mortgage loan growth accelerating in the future due to seasonal demand for moving and the expanded mortgage lending capacity allowed for financial companies under the newly introduced housing finance measures announced last month (August 13). Therefore, it is necessary for financial authorities and financial companies to continue to closely monitor relevant trends and strictly manage the pace of household loan growth.

Financial authorities and financial companies should also work to make sure that the upward adjusted target of household loan growth for this year can directly translate into more housing supply, more housing finance assistance for young adults, and more support available for non-speculative homebuyers.

In the meantime, authorities will review situation on fixed-rate mortgage loans to promote the introduction of longer term fixed-rate mortgage loans in the banking sector.

* Please refer to the attached PDF for details.