Household debts in South Korea kept rising last month on the near-record-low borrowing costs, offsetting the government's efforts to curb multiple-home purchase with borrowed money, central bank data showed Thursday.
Debts owed by households to banks reached 807.7 trillion won (706.4 billion U.S. dollars) as of end-September, up 5.1 trillion won (4.6 billion U.S. dollars) from a month earlier, according to the Bank of Korea (BOK).
The growth was faster than an increase of 4.9 trillion won (4.3 billion U.S. dollars) tallied in the same month of last year.
The fast expansion came as the BOK refrained from altering its policy rate after raising it to the current level of 1.50 percent in November last year from an all-time low of 1.25 percent.
It offset the government's efforts to control speculative investment in the real estate market. Households rushed to purchase multiple homes with borrowed money amid the near-record-low borrowing costs.
Mortgage loan increased 3.6 trillion won (3.1 billion U.S. dollars) over the month to 594.7 trillion won (520.1 billion U.S. dollars) at the end of last month. It was the fastest gain since July last year.
Other loans extended by banks to households, including credit loan, rose 1.4 trillion won (1.2 billion U.S. dollars) in September from a month earlier.
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