Household debt in banks increased by 10 trillion won in April-May
Structural adjustment of PF businesses intensifies this month
Candidate Kim: “Will manage PF and household debt in the latter half of the year”
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Kim Byung-hwan, the newly appointed candidate for the chairmanship of the Financial Services Commission, is speaking about his nomination at a briefing room at the Blue House in Yongsan on the 4th. /News1,
, ‘Kim Byung-hwan, former Vice Minister of the Ministry of Economy and Finance, has been named as the new candidate for the chairmanship of the Financial Services Commission on the 4th, raising expectations on how to address various financial issues such as household debt management and Real Estate Project Financing (PF). On the same day, Kim emphasized real estate PF and household debt management during a briefing held at the Blue House in Seoul shortly after being nominated as the new chairman.’,
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, ‘With the recent revival of the real estate market centered around the Greater Seoul Metropolitan Area, household debt has surged. Household loans from banks increased by 5.1 trillion won in April and further expanded to 6 trillion won in May. It appears that bank household loans have also significantly increased in June. According to the announcement made by the five major banks (KB Kookmin, Shinhan, Hana, Woori, NH Nonghyup Bank) on the 2nd of this month, the increase in household loans for last month was 5.3415 trillion won. When combined with internet banks, regional banks, and foreign banks, the increase is expected to be even greater.’,
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, ‘As household loans from banks have increased significantly, financial authorities warned banks not to excessively expand household loans. They plan to start on-site inspections from the 15th.’,
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, ‘During the briefing, Kim stated, “It is expected that household debt will stabilize this year, but we will carefully manage it in the second half of the year.”‘,
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, ‘Landing real estate PF worth 230 trillion won is also a pressing issue. Kim mentioned, “Among the financial market risks in the latter half of the year, it is necessary to manage risks related to real estate PF first.”‘,
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, ‘By the 5th of this month, financial companies are required to submit the results of the business feasibility evaluation for real estate PF businesses. Financial authorities will immediately conduct on-site inspections for financial companies that submit poor business feasibility evaluation results.’,
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, ‘Since mid-May, financial companies have reassessed real estate PF businesses based on a 4-level (excellent, normal, caution, concern about insolvency) business feasibility evaluation criteria. Financial companies must submit restructuring plans for businesses with concern about insolvency by the end of this month. This marks the beginning of the actual restructuring of PF businesses.’,
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, ‘Financial authorities estimated that 5-10% of businesses would be subject to restructuring in May, with about 2-3% requiring judicial or public auctions. It is expected that a maximum of 7 trillion won worth of auctions will take place, and the total restructuring volume, including auction and reorganization, is expected to reach 23 trillion won.’,
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, ‘During this process, there is also a risk of an increase in non-performing loan ratios for mutual savings banks and savings banks, which may lead to a liquidity crisis. Financial authorities are preparing for a crisis similar to the Saemaeul Credit Union incident last year. Kim emphasized the need to minimize the impact on the financial sector during the restructuring of PF businesses.’,
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, ‘Kim mentioned, “I believe that we have been steadily working on the landing of real estate PF measures in the first half of the year and if we continue to tidy up accordingly, can we reduce the risk in the latter half of the year.”‘,
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, ‘There are also various issues related to the capital market, such as the Value-up Program and improvements in short selling rules. Financial authorities have decided to extend the blanket ban on short selling until March 30 next year and establish a system to prevent illegal short selling. The government announced tax reform plans, including corporate tax, inheritance tax, and income tax, to activate the Value-up Program.’,
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, ‘Kim started his career in public service with the 37th Administrative Examination and began his public service at the former Institute of Finance and Economy. He has held key positions in macroeconomic policy, such as Head of Fund Market, Head of Economic Analysis, Head of Comprehensive Policy, and Director of the Economic Policy Department. Born in 1971, he is the youngest candidate for the chairmanship of the Financial Services Commission.’,
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