[비즈한국] As the domestic stock market continues its 'bull run,' with the KOSPI index surpassing the 8,000 mark for the first time in history, the turnover rate for demand deposits at domestic banks has reached its highest level in nine years. Furthermore, the combined total of stock market 'waiting funds,' including investor deposits and Cash Management Accounts (CMA), has exceeded 250 trillion won for the first time ever.
As the KOSPI index hits new record highs day after day, funds previously held in banks are moving in search of other investment opportunities, and money flowing into the stock market is surging. The market is enthralled by a rally that has far surpassed the 'KOSPI 5000' goal pledged by President Lee Jae-myung during the last presidential election. However, some point out that one should prepare for future volatility due to the potential interest rate hikes by the Bank of Korea and geopolitical risks in the Middle East.
During the presidential campaign on May 29 last year, President Lee stated, "The economy thrives on rationality and predictability, but the market was unfair under conservative administrations. Together with the 14 million individual investors and the 52 million citizens, I will realize a new hope called 'KOSPI 5000'." He particularly emphasized, "There were no proper industrial policies, so stock prices did not rise, and people were busy escaping to the US stock market. A competent Democratic government will establish fair market order through a major overhaul of the industrial structure, and I will realize the new hope of 'KOSPI 5000' in a stock market that has been held back by the 'Korea Discount' due to opaque corporate governance."
At the time, the 'KOSPI 5000' campaign pledge was criticized by other parties as absurd. However, the KOSPI index, which hovered around the 2,700 level at the time of the Lee Jae-myung administration's inauguration, surpassed the 4,000 mark for the first time in history in October 2025, and reached the president's pledged 5,000 level this January. The KOSPI's sprint continued, crossing 6,000 just a month later in February, followed by 7,000 on May 6, and even 8,000 on the 15th. This is a stark contrast to the 18 years and 4 months it took to go from 1,000 to 2,000, and an additional 13 years and 6 months to reach 3,000.
As the KOSPI's sprint has continued unabated since the inauguration of the Lee Jae-myung administration, the number of people trying to enter the stock market, even if belatedly, is increasing. According to the Bank of Korea's Economic Statistics System, the turnover rate of demand deposits at domestic commercial banks in the first quarter of this year was 21.3, the highest in 117 months since the 21.6 recorded in the second quarter of 2016. Demand deposits refer to funds in accounts that allow free withdrawals, such as ordinary and checking accounts. Most are short-term waiting funds held temporarily for payment purposes or investment.
The turnover rate of these demand deposits is the value obtained by dividing the total amount withdrawn by the average balance of the deposits; a high turnover rate means that account holders are actively withdrawing money from banks to invest. The demand deposit turnover rate fell from 17.5 in the first quarter of last year to 17.1 in the second quarter, but rose to 18.7 in the third quarter when the KOSPI's sprint began, and increased to 19.6 in the fourth quarter. As the KOSPI's upward trend continued thereafter, it even surpassed 20 in the first quarter of this year.
In fact, the flow of funds into the stock market is becoming increasingly clear. As the fear of missing out (FOMO) among personal investors grows, the combined total of investor deposits and CMA balances has surpassed 250 trillion won for the first time in history. According to the Korea Financial Investment Association, on May 8, investor deposits reached 135.2991 trillion won and CMA balances reached 116.6655 trillion won, totaling 251.9646 trillion won. It is the first time since the statistics were first compiled that these two types of stock market 'waiting funds' have combined to exceed 250 trillion won. The combined waiting funds were 188.1683 trillion won at the end of last year, crossed the 200 trillion won mark on January 26 this year at 200.3358 trillion won, and have now surpassed the 250 trillion won threshold. This represents an increase of over 30% since the start of this year.
In particular, the rise in these stock market waiting funds has been led by investor deposits, which represent money looking for stock purchase opportunities. Investor deposits stood at 87.3986 trillion won at the end of last year, exceeded 100 trillion won on January 27 this year at 100.2826 trillion won, and surpassed 130 trillion won on May 6 at 130.7433 trillion won. Commercial liquidity is rapidly moving from bank deposits to brokerage accounts amidst the booming stock market.