SEOUL, Sept 11 Reuters South Korea39;s household borrowing rose in August by the biggest amount in more than three years, led by a record jump in mortgage demand, central bank data showed on Wednesday.

Household borrowing from banks stood at 1,130.0 trillion won 840.52 billion at the end of August, up 9.3 trillion won over the month, the biggest monthly increase since July, 2021.

Mortgage loans rose 8.2 trillion won, the biggest increase since the data release started in 2004, according to the Bank of Korea BOK.

At a meeting with local banks on Tuesday, the country39;s financial watchdog expressed concern about a rapid pickup in household debt and said such financial imbalances may turn into systemic risk. The head of the watchdog also urged banks to enhance risk management, after authorities tightened lending rules earlier this month.

In September, household debt growth is expected to narrow from August on government measures and banks39; management efforts, a BOK official said, adding there were also were temporary factors impacting the data in August.

The Financial Services Commission said authorities would implement additional measures currently being reviewed in a timely and bold manner, if the housing market remains heated or household debt growth accelerates.

Last month, the central bank39;s board members were cautious about lowering interest rates, as they were concerned about rising risks to financial stability despite slowing inflation, minutes from the…