Excess funds held by Korean households continued to rise in the first quarter despite a dip in their borrowing, while local companies saw their shortage of funds dwindle, central bank data showed Thursday.

Excess funds held by local households, including nonprofit organizations, came to 24.3 trillion won ($21.07 billion) as of end-March, up 3.2 trillion won from three months earlier, according to preliminary data from the Bank of Korea.

Nonprofit organizations include institutions that serve households, such as consumer groups, charity and relief organizations, religious groups and labor unions.

Excess funds refer to the amount of money that remains on the balance sheet for households after deposits and stock investments.

It is calculated by subtracting the amount of funds used for financial assets from the amount raised.

The on-quarter increase came despite a large cut in the amount of funds raised by households and nonprofit organizations, possibly suggesting that more are simply holding on to cash instead of investing or making deposits.

In a widely unexpected move, the BOK slashed its key interest rate to a record low of 1.25 percent earlier in the month, forcing some local lenders to lower their interest rates paid on deposits to as low as 0.01 percent.

In the January-March period, the amount of fresh funds raised, mostly borrowed, by households and nonprofit organizations came to 20.2 trillion won, compared with 39.1 trillion won tallied in the fourth quarter of 2015, according to the BOK.

The amount raised by nonfinancial local companies shrank ton21.4 trillion won from 30.5 trillion won over the cited period. However, their shortage of funds also dwindled to 3.5 trillion won from 6.5 trillion won.

The BOK said the decline in the amount of additional funds needed by local companies was partly attributed to their improved profitability.

The value of excess funds held by the central and local governments came to 5.3 trillion won as of end-March, down 10.1 trillion won from the previous quarter.

As of end-March, the country's overall financial assets were valued at 14,945 trillion won, up 2.4 percent from three months earlier.

Financial assets held by households and nonprofit organizations gained 1.7 percent on-quarter to 3,230.9 trillion won, while their total liabilities rose 1.4 percent to 1,442.7 trillion won. (Yonhap)