SEOUL: The amount of money drawn out from overdraft accounts has risen to the highest level in nearly four years last week, as borrowers take out more credit for stock investment, data show.
The outstanding overdraft balance of individuals at five major lenders – KB Kookmin Bank, Shinhan Bank, Hana Bank, Woori Bank and NH Nonghyup Bank – stood at 43.34 trillion won as of last Thursday.
It marks the highest figure since October 2022 in terms of end-month balance. Outstanding credit loans, including overdrafts, came to 108.7 trillion won, the highest level in three years.
As of last Thursday, borrowers spent a total of 43.3 trillion won from such accounts with a combined maximum credit limit of 96.7 trillion won. The average usage rate of overdraft accounts was 44.8%, recording the highest level ever since the pandemic.
Industry watchers expect overdraft usage could expand even further, as borrowers use their overdrafts to secure short-term liquidity amid the volatile market.
The benchmark Korea Composite Stock Price Index has shown dramatic swings,
The Bank of Korea (BoK) has also raised concerns over leveraged investments, saying its increase could pose potential risks to South Korea’s financial stability.
According to the BoK’s financial stability report, the exhaustion rate of overdrafts rose from 35% in 2024 to 35.4% as of end last year and to 36% in first quarter of 2026. — The Korea Herald/ANN
