SEOUL: Household loans extended by South Korean banks fell for the second consecutive month in January on tightening loan regulations and a slowing real estate market, data showed on Wednesday.
Banks' outstanding household loans stood at 1, 140.5 trillion won (US$785.08 billion) as of end-January, down 500 billion won from a month earlier, according to the data from the Bank of Korea (BOK), reports Yonhap news agency.
It marked the second straight monthly decline, as household loans fell for the first time in nine months in December after financial authorities pressed major lenders to implement tight lending rules to rein in surging household debts and rising home prices.
Home-backed loans went up 1.7 trillion won from a month earlier in January, following an 800 billion-won increase in December. The outstanding mortgages stood at 904.3 trillion won at end-January.
But unsecured or other types of loans extended by banks to households fell 2.1 trillion won to 235.3 trillion won last month.
"Banks began to ease some of the regulations for home-backed loans at the beginning of this year. But home transactions and housing prices have trended down, leading to weak demand for fresh loans, " a BOK official said.
Corporate loans advanced 6.7 trillion won from a month earlier to 1, 322.9 trillion won in January, following an 11.5 trillion-won decline the previous month amid heightened uncertainties at home and abroad.
"January's increase in corporate loans appeared to have been attributable to seasonal factors, such as funds for bonus payments for the Lunar New Year holiday and for paying taxes, " the official said.
In other developments, South Korea will invest US$285 million in developing advanced technologies to foster innovation across various industries by 2031 as part of efforts to foster future growth engines, the industry ministry said on Wednesday.
The investment project kicked off in 2022 with an aim to support innovative technology development projects that will reshape future industries, according to the Ministry of Trade, Industry and Energy.
This year, the ministry selected three new items for investment, which are transcendence of space-time limitations on energy transmissions, advanced cyber security mechanisms and neuro-artificial intelligence (AI) fusion technology to strengthen the physical capabilities of humans.