South Korea household lending growth at eight-month high

Growth in bank lending to South Korean households in February hit an eight-month high on more loans backed by property, central bank data showed on Wednesday. Bank lending to South Korean households rose by 2.8 trillion won ($1.87 billion) in February from the previous month, the biggest rise since a 3.1 trillion won gain in June 2008, to 389.7 trillion won, the Bank of Korea said.
Lending backed by housing grew 3.3 trillion won in February from the prior month, the largest gain since a 4.2 trillion won rise in November 2006, the central bank said in a statement.
"In the past, people used lending backed by houses to buy new homes. But they seem to use these loans for their daily lives or to inject money into their businesses amid an economic slowdown," an official at the Bank of Korea told Reuters, asking not to be identified as he was not authorised to speak to the press. In January, outstanding loans owed by households to banks fell by 1.6 trillion won. Bank lending to small and medium-sized enterprises (SMEs) grew by 2.8 trillion won in February to 405.7 trillion won, after rising 2.6 trillion won in January.