A local civic group, the Good Politics Citizen Network, has released an analysis of Jeonbuk's economic trends based on the Bank of Korea's Economic Statistics System (ECOS). According to their findings, as of the end of January 2025, household lending in Jeonbuk decreased while corporate lending continued to rise compared to the same month last year.
Specifically, the balance of household lending in Jeonbuk stood at 25 trillion 7,671 billion won, marking a 2.0% decline from the same period last year. Interestingly, household lending via Jeonbuk Bank increased by 6.4% to reach 11 trillion 9,638 billion won, while non-bank household lending shrank by 8.3% to 13 trillion 8,033 billion won, indicating a significant shift in the lending landscape of the region.
Notably, Jeonbuk’s banks account for only 46.4% of total household loans in the region, which is considerably lower than the national average of 75.7%. Meanwhile, non-bank lending constitutes 53.6% of the overall figure, showing how challenging it is for residents to access loans from traditional banks.
The breakdown of household loans reveals that mortgage loans have increased to 13 trillion 4,535 billion won, reflecting a 7.7% rise, while other types of loans have decreased by 10.9%, standing at 12 trillion 3,136 billion won. This suggests that while families are investing in their homes, other borrowing sources may be tightening up.
Overall, mortgage loans account for 55.2% of total household loans in Jeonbuk, which remains below the national average of 66.1%. This signifies that Jeonbuk residents are likely facing stricter terms regarding mortgage access compared to other areas of the country, as evidenced by rising borrowing standards.
On a broader scale, corporate lending in Jeonbuk rose to 41 trillion 6,157 billion won, a 4% increase compared to the same month last year. However, this growth still fell short of the national average growth of 4.8%, signaling potential challenges ahead for business owners in the province.
As of the end of 2024, Jeonbuk's household loan delinquency rate stood at 0.61%, ranking it as the fifth highest in the country, while the corporate loan delinquency rate was reported at 0.56%, exceeding the national average and raising red flags about financial pressures faced by Jeonbuk residents and businesses.
Moreover, as of the end of January 2025, Jeonbuk's loan delinquency rate reached 1.43%, the highest among all local governments. This alarming statistic highlights the difficulties in financial management and the increased likelihood of defaults on loans in the region.
The Good Politics Citizen Network stated, “The high rates of delinquency and note dishonor in Jeonbuk’s banks reflect the challenging environment faced by households and businesses.” Additionally, they emphasized the urgent need for local governments and the Bank of Korea to closely monitor the economic situation and take preventive measures to avert further crises.
Turning to future prospects, the analysis also pointed out that while household mortgage lending has shown consistent growth annually—excluding 2023—other forms of loans have experienced a steady decrease since 2021. This trend raises concerns about the overall economic stability in Jeonbuk.
In conclusion, the findings regarding the economic trends in Jeonbuk underscore the complexities faced by both consumers and businesses within the region. With household lending decreasing alongside rising corporate borrowing and major delinquency rates, economic experts suggest that proactive measures should be considered to alleviate the financial strain on the populace.
