South Korea's top financial regulator said Thursday that the government is considering additional measures to curb growing household debt in a bid to shield the economy from high indebtedness.

   South Korea is grappling with growing household debt, which reached 876.3 trillion won (US$825.1 billion) as of end-June. By hurting domestic demand, household debt has become the main constraint for the local economy.

   "If necessary, the government will draw up additional steps to stem household debt in a bid to lead household debt to make a soft landing at a stable level," Kim Seok-dong, chairman of the Financial Services Commission (FSC), said in a speech for a forum.

   In June, the government unveiled a set of measures to curb rising household debt by tightening banks' loan-to-deposit ratios and mending banks' lending practices. But despite such efforts, home loans extended their gains on the back of lending from non-bank institutions.

   The financial watchdog earlier said that it is considering measures to curb an excessive rise in household loans extended by non-bank institutions, but it added that efforts to tackle household debt should be made over the long haul in a way that doesn't shock the overall economy.

Source: Yonhap News (Sept. 15, 2011)