韩国信用卡公司下半年需再融资8.697万亿韩元，融资成本升至4.5%附近

Yields on specialized credit finance bonds have surpassed an annual 4.5%. Meanwhile, a large volume of card bonds issued during the low-interest-rate era will mature in the second half of the year. With the Bank of Korea recently raising its base rate to an annual 2.75% and leaving open the possibility of further hikes, card companies' funding burdens are expected to grow even larger. The industry believes this cost increase may be reflected in card loan rates in sequence.
According to the financial sector on the 21st, the eight specialized card companies (Lotte, BC, Samsung, Shinhan, Woori, Hana, Hyundai, and KB Kookmin Card) must refinance card bonds worth 8.697 trillion won from the 22nd through the end of the year. Lotte Card has the largest amount at 2.5 trillion won, followed by Hyundai Card (1.92 trillion won), KB Kookmin Card (1.8 trillion won), Shinhan Card (1.15 trillion won), and Samsung Card (880 billion won).
The problem is that a significant portion of the card bonds maturing this year were issued during the low-interest-rate period. Card companies raised funds at annual rates of 1% to 2% during 2019 and 2021. In contrast, current specialized credit finance bond yields have risen to the mid-4% range. Yields on specialized credit finance bonds (AA+, three-year) rose from 3.370% at the end of last year to 4.288% at the end of June. On the 20th, they recorded 4.500%, continuing their upward trend.
Among Samsung Card's card bonds maturing in the second half, a 60 billion won issue from 2019 carried a rate of only around the mid-1% level. A 280 billion won card bond issued in 2021 was also raised at around 2%, but must now be refinanced in a 4% rate environment.
The situation is similar at other card companies. Among KB Kookmin Card's 2021 issues, 100 billion won was at the 2% level and 80 billion won at the 1% level. A 60 billion won card bond issued in 2019 was also raised at the 1% level. Hyundai Card's 110 billion won card bond issued in 2021 likewise carried a rate in the low-2% range.
As card companies' funding costs rise, increases in card loan rates are inevitable. Rates have already climbed to high levels. Last month, Hyundai Card's average card loan rate based on newly executed loans surpassed 15%, recording an annual 15.04%. Although not a specialized company, NH Nonghyup Card's average card loan rate also came in at 15.08%. Samsung Card (14.19%) and Shinhan Card (14.03%) also recorded rates in the 14% range.
The rates for some low-credit borrowers approached the legal maximum interest rate (annual 20%). Among the 16 financial companies (banks and card companies) that handle card loans, average card loan rates for borrowers with credit scores of 700 or lower exceeded the 18% level, with Lotte Card at 18.10% and Woori Card at 18.53%.
If card loans rise further, the interest burden on vulnerable borrowers could grow even larger. Card loan usage also remains at a high level. As of the end of the first half of this year, the card loan balance at the nine card companies was 42.9093 trillion won, an increase of 580.1 billion won from 42.3292 trillion won at the end of last year. With banks' lending thresholds having risen, demand not only for living expenses but also for raising investment funds is interpreted to have had some effect. A financial industry official said, "As the stock market rose in the first half, card loan usage tended to increase more than usual whenever a market correction occurred," adding, "It appears there was demand for funds for additional purchases or so-called 'averaging down.'"
Rising funding costs could also weigh on card companies' profitability and soundness. A card industry official said, "In the second half, repayment burdens for some borrowers could grow due to increased stock market volatility and rising interest rates," adding, "For card companies, managing delinquency rates and soundness will become even more important."