Seoul: Household loans extended by South Korean banks grew at a faster pace in August compared to the previous month, driven by a recent increase in housing transactions despite government regulations, central bank data showed Wednesday.

According to Yonhap News Agency, banks' outstanding household loans stood at 1,168.3 trillion won (US$840.68 billion) as of end-August, marking a 4.1 trillion won increase from a month earlier. This represents an acceleration from the 2.7 trillion-won growth observed in July.

Home-backed loans saw an increase of 3.9 trillion won to reach 930.3 trillion won in August, which is up from a 3.4 trillion-won rise in the previous month. Additionally, unsecured and other types of household loans grew by 300 billion won to 237.1 trillion won, rebounding from a 600 billion-won decrease in July.

"Despite the continued effects of the lending regulations announced in June, the volume of mortgage loans for home purchases increased, as the rise in housing transactions in May and June was reflected with a time lag," BOK official Park Min-cheol stated during a press briefing.

Following late June, authorities implemented a 600 million-won cap on mortgage loans for property purchases in the capital region and suspended home-backed loans for multi-homeowners, aiming to control the soaring housing prices.

Housing transactions have increased significantly in recent months, especially in Seoul and nearby areas, as banks relaxed restrictions on household lending at the start of the year and the Seoul city government temporarily lifted land transaction permit requirements.

"The recent rise in housing prices in Seoul was partly due to concerns over a supply shortage, so the government's recent announcement of supply measures is expected to somewhat help stabilize the housing market. The key is to implement them without delays," Park added.

In addition, corporate loans rose by 8.4 trillion won in August from the previous month, following a 3.4 trillion-won increase in July. The total outstanding corporate loans stood at 1,354.8 trillion won as of the end of August, according to the data.

The BOK noted, "Loans to large corporations rose significantly, from 500 billion won to 3.8 trillion won, due to rising demand for debt repayment and securing operating capital."