Korea bank loan growth stalls in Q1 as household lending shrinks

Corporate lending drove bank loans in Q1 2026.

The loan growth of South Korea’s four biggest banks continued to be challenging in Q1 2026, growing only 0.4% to 1.4% quarter-on-quarter (QoQ), said Credit Sights.

Corporate lending drove bank loans during the period, whilst household lending contracted slightly due to tighter mortgage regulations, the report said.

Net income was boosted by strong equity market-related fee income and higher net interest margins (NIMs) at Kookmin Bank, Shinhan Bank, and KEB Hana Bank.

Woori lagged with a 2% profit decline as a result of a large one-off provision for its Indonesian subsidiary, Credit Sights said.

Asset quality metrics broadly weakened compared to Q4 2025, with group non-performing loan (NPL) ratios rising 5 to 10 basis points (bp), led by higher corporate NPL ratios and credit card delinquency rates.