Korea Business News Agency - NSP NEWS.

(Seoul=NSP NEWS AGENCY) = At the end of last year, household loans from the five major commercial banks increased by nearly KRW 800 billion, while corporate loans decreased by nearly KRW 9 trillion. This is because companies tend to increase loan repayments at the end of the year and banks tend to close their lending doors to manage soundness. However, at the end of last year, the martial law situation changed into an impeachment situation, and domestic and international uncertainties expanded, further increasing the decline in corporate loans.

According to KB Kookmin Bank, Shinhan Bank, Hana Bank, Woori Bank, and Nonghyup Bank on the 2nd, the total balance of corporate loans as of the end of December last year was KRW 820.6226 trillion, a decrease of KRW 8.9725 trillion from the previous month. The decrease has greatly increased since the increase/decrease amount in November last year turned into a decrease of KRW 770.4 billion.

As of the end of December last year, the balance of loans to large corporations was KRW 158.3936 trillion, a decrease of KRW 5.2407 trillion from the previous month. This is the second consecutive month of decrease since the KRW 1.012 trillion decrease in October.

The decrease in loans to individual business owners also widened. The balance of loans to individual business owners decreased by KRW 1.3886 trillion from the previous month to KRW 325.6218 trillion. The decrease has increased nearly sevenfold since the balance of loans to individual business owners decreased by KRW 205 billion from the previous month in October last year.

A banking official explained, “Typically, companies pay off their debts at the end of the year to manage their financial statements,” and “Banks reduce lending at the end of the year to manage soundness and release more at the beginning of the year, so the balance of corporate loans at banks tends to decrease at the end of the year.”

By Soon-ki Lee(s8789@nspna.com) and Soo-in Kang(sink606@nspna.com)

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