South Korea raises target for fixed rate household loans, mortgages

[SEOUL] South Korea has raised its targets for fixed rate household loans and amortised mortgages in 2016 and 2017, the financial regulator said on Thursday.

The Financial Services Commission said in a statement it set a target for fixed rate household loans at 40 per cent of all household bank loans by end-2016, and 42.5 per cent by end-2017, from 36.8 per cent as of end-March.

It also increased the target of amortized mortgage loans to 45 per cent of all applicable loans by end-2016, and 50 per cent by end-2017, from 39.5 per cent as of end-March.

South Korea's household credit in the March quarter rose at the fastest annual pace in nearly nine years, central bank data showed earlier on Wednesday.

Lower interest rates have cut about 4 trillion won (S$4.66 billion) from households' interest payments in the last three years, the regulator said.

REUTERS