South Koreans hoarded cash to push up hard currency deposits to an all-time high of 90.1 trillion won ($75.9 billion) in the first quarter as they played by the centuries-old habit to stock physical money at times of uncertainties.

Korean households banked additional 2.9 trillion won in January-March period this year compared to three months earlier or before the COVID-19 crisis emerged to bring their total cash holdings to 90.1 trillion won, according to the Bank of Korea on Tuesday. It was the first time ever for household cash holdings to top 90 trillion won since the bank began tracking the data in 2008.

The quarter-on-quarter growth rate was 3.4 percent, the fastest since the third quarter of 2018. There have been only five occasions when the growth rate topped 3 percent.

“Fears about COVID-19 peaked in the first quarter in Korea, leading households pile up cash to prepare against uncertainties,” said Hwang Se-woon, senior economist at Korea Capital Market Institute.

As of the end of March, the total financial assets held by Korean households and non-profit organizations stood at 3,975.8 trillion won, down 0.14 percent compared to three months earlier. It is the first decline since the fourth quarter of 2018.

Cash accounted for 2.27 percent of the total financial assets in the first quarter. Cash share was the highest ever. It exceeded the 2 percent level for the first time in the fourth quarter of 2016 and had expanded every quarter since the second quarter of 2019.

By Pulse

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