SEOUL, Nov. 25, 2009 (Xinhua News Agency) -- South Korea's household credit climbed in the third quarter as nonbank financial firms expanded home-backed loans improving consumer confidence boosted card spending, the central bank said Wednesday.
According to the Bank of Korea (BOK), the country's outstanding household credit, which refers to family credit purchases and loans, posted 712.8 trillion won (616.7 billion U.S. dollars) in the third quarter, up 15 trillion won (13 billion U.S. dollars) or 2.2 percent from a quarter earlier.
Despite of the government's stricter regulation on bank mortgage lending, the pace of home-backed loans extended by nonbank financial institutions picked up, the BOK explained the reason behind the rise.
According to the BOK, total household lending extended by local financial institutions reached 675.6 trillion won (584.4 billion U. S. dollars), up 14.1 trillion won (12.2 billion U.S. dollars).
While bank mortgage loans slowed down in growth from a 7.1 trillion-won (6.14 billion U.S. dollars) gain three months earlier to a 4.8 trillion-won (4.15 billion U.S. dollars) rise, home lending by nonbank financial institutions climbed 3.2 trillion won (2.78 billion U.S. dollars), accelerating from a 2 trillion won increase in the second quarter.
The bank also explained card spending was boosted up by improved consumer sentiment, citing the on-quarter rise of 1 trillion won (865 million U.S. dollars) in credit purchases to 37. 2 trillion won (32.2 billion U.S. dollars).
The data came amid the South Korean economy marking a 2.9 percent on-quarter growth in the July-September period, the fastest quarterly expansion in more than seven years.
