Corporate loans log slowest growth in 8 years in Q4 amid uncertainty: BOK

SEOUL, March 7 (Yonhap) — Corporate loans rose at the slowest pace in eight years in the fourth quarter of 2024 amid heightened uncertainties, central bank data showed Friday.

The outstanding loans extended to local companies came to 1,962.2 trillion won (US$1.36 trillion) as of end-December, up 3.3 trillion won from three months earlier, according to the data from the Bank of Korea (BOK).

It marked the slowest growth since the fourth quarter of 2016, when the loans fell 900 billion won on-quarter.

By sector, loans to manufacturing firms fell 1.6 trillion won on-quarter to 483.4 trillion won as of end-December, marking the first quarterly fall since the fourth quarter of 2023.

Loans in the service sector, however, expanded 3.9 trillion won to 1,253.7 trillion won over the cited period, though the growth slowed from a 7.5 trillion-won increase in the previous quarter.

“Corporate demand for facility funds appeared to have shrunk due to uncertainties at home and abroad,” a BOK official said.

South Korea is facing multiple downside risks amid uncertainties stemming from U.S. President Donald Trump’s new tariff plans and domestic political chaos caused by now-suspended President Yoon Suk Yeol’s shocking martial law imposition in December.