SEOUL, Oct. 2 (Korea Bizwire) – Excess funds held by South Korean households fell in the second quarter of this year from a quarter earlier on increased purchases of new houses amid a property boom, central bank data showed Tuesday.
Net financial funds, covering assets minus liabilities, controlled by households and nonprofit organizations totaled 11 trillion won (US$9.86 billion) during the April-June period, down from 16.9 trillion won the previous quarter, according to preliminary data from the Bank of Korea (BOK).
The figure is the lowest since the third quarter of last year, when it stood at 9.7 trillion won.
Nonprofit institutions are considered to be organizations serving households, such as consumer groups, charity and relief organizations, religious groups and labor unions.
“The decline seems attributable to more people extending loans to buy houses or invest in real estate amid low interest rates and the sluggish stock market,” a BOK official said.
Non-financial corporations’ net borrowing was up from 9.9 trillion won in the first quarter to 15.4 trillion won in the second — the largest figure since the second quarter of last year.
The increase in borrowing was due to poor performances by some public utility companies, the BOK noted.
On the other hand, funds held by the government surged to 13.1 trillion won in the second quarter from 7.5 trillion won the previous quarter.