The growth pace of South Korea’s household debt slowed down last year thanks to a fall in real estate transactions amid the government’s tougher measures to cool down the heated housing market.

According to data released by the Financial Services Commission (FSC) and Bank of Korea (BOK) on Wednesday, household loans in the banking and non-banking sectors grew 90.3 trillion won ($84.3 billion) last year, slowing from the gain of 123.2 trillion won in the previous year. In December 2017 alone, household debt increased 5.9 trillion won, down by 3.3 trillion won compared to the same month a year earlier.

Outstanding household loans from banks amounted to 766.8 trillion won as of the end of December in 2017, adding 58.8 trillion won from a year ago, the central bank said. The year-on-year gain was smaller than that of 2016 with 68.8 trillion won and 2015 with 78.2 trillion won.

Mortgage loans rose 37.1 trillion won to 570.1 trillion won, moderating from increases of 55.8 trillion won in 2016 and 70.3 trillion won in 2015. However, other loans including overdraft accounts, credit loans and commercial property loans grew 21.6 trillion won to 195.8 trillion won last year, marking the largest on-year gain since record-keeping began in 2008.

An official from the BOK said the government’s strong regulations may have caused the easing in mortgage loans, but other loans increased due to the launch of online-only banks and low-interest loans offered by some banks last year.

By Kim In-oh and Choi Mira

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