Following commercial banks, mutual finance institutions are also moving to tighten household lending.
According to the financial sector on the 12th, Saemaul Geumgo has decided to suspend, for the time being starting on the 19th, household loans arranged through loan brokers, as well as group loans such as relocation expenses, interim payments, and final payments. In addition, the National Credit Union Federation of Korea is reportedly reviewing a plan to suspend household loans arranged by loan brokers as well.
Within the industry, there are projections that other institutions such as the National Federation of Fisheries Cooperatives and the National Agricultural Cooperative Federation will also review suspending broker-driven sales.
This is because mutual finance institutions have recently been pointed out as playing a primary role in the increase in household loans. According to the Financial Services Commission, overall household loans last month increased by 1.4 trillion won, while household loans from mutual finance institutions alone grew by as much as 2.3 trillion won.
In particular, home mortgage loans increased by 3 trillion won over the past month, and analysts say this was driven by a 3.6 trillion won increase in mortgage loans from non-bank financial institutions. In contrast, bank mortgage loans decreased by 600 billion won last month.
Mutual finance institutions also led strong household loan growth last year. For example, household loans at Saemaul Geumgo increased by 5.31 trillion won compared with a year earlier, exceeding four times its targeted increase. This is also a level comparable to the combined increase of the five major commercial banks, which was 5.7462 trillion won.
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