K Bank Extends Overdraft Account Suspension Through August 31 Amid South Korea's Credit Tightening

According to Yonhapinfomax, on July 28, K Bank extended its suspension of new overdraft account openings through August 31, prolonging the measure by one month as part of broader regulatory efforts to control household credit growth. The bank stated the extension aims to ensure stable household lending amid financial authorities' total credit volume targets for 2026.

The move comes as demand deposits at South Korea's five major banks plummeted 41.03 trillion won through July 23, with investors withdrawing cash for stock purchases, redirecting credit demand toward overdraft facilities. Overdraft account balances at the five largest banks reached 43.93 trillion won as of July 23, surging 4 trillion won since Q1, while utilization rates climbed above 45%, approaching historical highs not seen since October 2022.