SEOUL, November 21 (AJP) - KB Kookmin Bank and Hana Bank, two of South Korea’s largest lenders, said they will suspend new home purchase loans through the end of the year, a move that is expected to be followed by other major banks and could create a year-end “loan cliff” for prospective buyers.
According to industry officials, KB Kookmin Bank will stop accepting new mortgage applications for home purchases beginning Nov. 22 on its online platforms and Nov. 24 at branches. The bank will also halt refinancing products from other lenders and suspend online credit loans starting Nov. 22.
Hana Bank had already announced plans to curb new applications for mortgages and lease loans beginning Nov. 25, citing the need to control lending volumes amid heightened regulatory scrutiny.
A KB Kookmin Bank spokesperson said the measures were intended to “maintain the soundness of our year-end household loan portfolio,” emphasizing that loans for living expenses — including home equity and lease loans — will continue to be available through December.
The restrictions come as the government is making an all-out effort to rein in home prices in Seoul and surrounding areas. Banks also face pressure to manage rapidly expanding household debt, long considered one of the most persistent risks to South Korea’s financial stability.
* This article, published by Aju Business Daily, was translated by AI and edited by AJP.
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