SEOUL, May 23 (Reuters) - South Korea’s rapid household debt growth slowed slightly in the March quarter versus a year earlier as some mortgage rates rose, the central bank said on Tuesday.
Household debt during the first quarter of this year, including loans and other debt owed by South Korean households rose 11.1 percent from a year earlier to 1,359.7 trillion won ($1.22 trillion), preliminary data from the Bank of Korea showed, after soaring 11.6 percent in the fourth quarter of last year.
Quarter-on-quarter debt growth slowed to 1.3 percent after expanding 3.6 percent over the October to December period.
“Local mortgage rates have been moving higher, and demand for loans is generally weak during the winter season as fewer households look for places to move,” a central bank official said.
Mortgages and other loans from depository institutions grew 8.4 trillion won to 917.1 trillion won, while borrowings from insurers and pension funds increased by 8.4 trillion to 369.5 trillion won.
The average mortgage rate rose to 3.21 percent in March from 3.19 percent in February, and up from 3.13 percent as of December 2016 - the highest in 25 months.
Total household debt is now equivalent to 83 percent of gross domestic product, according to the Bank of Korea, while the central bank’s benchmark rate is currently at a record low of 1.25 percent. ($1 = 1,118.1500 won) (Reporting by Cynthia Kim; Editing by Eric Meijer)