Both stock investments and borrowings from banks by South Korean households reached a record high level in the third quarter of last year, suggesting a significant amount of debts flowed into the stock market which is more heated than ever before.

According to Bank of Korea data released on Thursday, the net funds managed by households and non-profit organizations came to 30.7 trillion won ($28.23 billion) at the end of September last year, which is about half the second quarter’s figure but 14 trillion won higher than a year ago.

The total amount of funds managed by households regardless of their fund sources was 83.8 trillion won, which was less than that in the second quarter of last year (110 trillion won), but more than doubled from a year ago (40.6 trillion won).

By fund management sector, equity securities and investment funds (22.5 trillion won) surpassed a previous peak of 21.3 trillion won in the second quarter. Compared to the third quarter of last year, it is 23 trillion won higher.

Bond holdings also rose more than 10 trillion won from 400 billion won to 9.7 trillion won in one year, but they did not reach a previous peak in the second quarter (11.5 trillion won).

Deposits from financial institutions (24.5 trillion won) decreased by 51 percent from the second quarter (49.8 trillion won), which was similar to the level in the third quarter in 2020 (27.3 trillion won).

Households raised 53.2 trillion won in the same period, of which financial institution borrowings were the largest at 52 trillion won. This is the highest quarterly level since data compilation in 2009.

By Pulse

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