Oct. 12 (Bloomberg) -- South Korea’s bank lending to households increased the least in eight months as payment of holiday bonuses to workers reduced the need to borrow.
Lending to households increased by 600 billion won ($511 million) last month to a record 448.7 trillion won, the Bank of Korea said in an e-mailed statement today.
Bank of Korea Governor Kim Choong Soo has said the central bank needs to “normalize” interest rates to curb record household debt and inflation above his target. Even so, Kim and his board will keep borrowing costs at 3.25 percent for a fourth straight month tomorrow amid concern a global slowdown will damp the nation’s growth, according to all 15 economists surveyed by Bloomberg News.
Mortgage lending rose 1.1 trillion won to 299.7 trillion won, today’s report showed. Loans to companies advanced 4.8 trillion won to 553.6 trillion won.
The broadest measure of money supply, M2, gained 4 percent in August from a year earlier after rising 3.2 percent in July.
--Editors: Ken McCallum, Sunil Jagtiani
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