Corporate loans from non-banking financial institutions sharply increased in the first half of this year.
 
According to the Bank of Korea(BOK) on Monday, the outstanding amount of corporate debt owed to non-bank lenders reached 113-point-four trillion won at the end of June, up 16-point-four trillion won or 16-point-nine percent from the end of last year.
 
The growth is nearly twice as much as the increase in the first half of last year and is the largest half-year growth since the BOK started compiling related data in 2013.
 
Analysts attributed the increase to a “balloon effect,” whereby pressure applied in one area pushes air into another area of less resistance.
 
They viewed that as the government toughened household loan screenings by non-bank lenders, they reduced household loans and instead expanded corporate loans.
 
Non-bank financial institutions include credit unions, mutual savings banks, cooperative federations and community credit cooperatives.