SEOUL, June 28 (Xinhua) -- Surplus funds owned by South Korean households reduced in the first quarter on rising home purchases amid the record-low interest rate, central bank data showed Wednesday.
Net fund management of households and non-profit organizations reached 14.1 trillion won (12.3 billion U.S. dollars) in the January-March quarter, down 5.1 trillion won from the previous quarter, according to the Bank of Korea (BOK).
The net fund management refers to fund management, including deposits, insurance and stock investment, minus borrowed money, measuring extra funds owned by households.
The spare fund reduced as households rushed to purchase new homes with borrowed money amid the record-low borrowing costs.
The BOK lowered its benchmark rate from 3.25 percent in July 2012 to an all-time low of 1.25 percent in June last year.
During the first quarter, household debts increased by 16.8 trillion won. Among the total, debts owed to non-bank deposit takers demanding higher lending rates than banks rose 4.2 trillion won in the first quarter, doubling the 2.1 trillion won expansion in the same quarter of last year.
The net fund management by non-financial companies jumped to 2.7 trillion won in the first quarter from 1.4 trillion won in the previous quarter.
Industrial companies refrained from borrowing money and spending the money in facilities amid worry about global economic slump.
