South Korean bank corporate lending reaches highest level in 28 months

Corporate lending at South Korea's five largest commercial banks posted its largest monthly increase in two years and four months during October 2026. UPI reported that the sharp increase pushed total outstanding corporate loans above 900 trillion won, which is approximately $670.4 billion. [1]

The surge in lending has coincided with growing concerns regarding the financial health of the banking sector. UPI reported that bank delinquency rates and nonperforming loans reached their highest levels in years, with the deterioration being particularly pronounced in corporate loans. [1]

Household lending in South Korea also returned to growth in October after falling in September. According to UPI, expanding loan portfolios could place added pressure on overall asset quality for banks during a prolonged period of elevated interest rates. [1]

The financial strain comes amid existing debt pressures in the country. As FTMQ Business reported earlier, rising interest rates have particularly affected South Korean borrowers in their 20s and those aged 60 and older, who carry significant non-bank debt balances. [5]