SEOUL, KOREA- Korea's household debt pile hit a record-high level at 980 trillion won, approaching almost the 1,000-trillion-won level. The Bank of Korea said on August 22 in a report "Household Credit Situation (Preliminary)" that the nation's consumer debt level as of the end of the second quarter 2013 was 980.0 trillion won, up 16.9 trillion won from the previous quarter's 963.1 trillion won.
The main factor that led the increase for the quarter was lending by commercial banks. Mortgage and personal loans rose during the quarter 17.5 trillion won to 926.7 trillion won. The remaining balance was accounted for by sale on credit provided by credit card and credit finance companies.
Lee Jae-ki, senior manager in charge of financial statistics, said, "Mortgage loans increased by a large margin because of a rapid rise in house purchases before the expiration of home sales tax cut on June 30."
The outstanding loan balance of banks for the quarter has increased by 8.3 trillion won to 470.7 trillion won, of which mortgage loans accounted for the bulk of the increase at 5.6 trillion won.
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