Financial Supervisory Service Raises Capital Market Crisis Level from 'Caution' to 'Alert'

[Asia Economy Reporter Eunmo Koo] The Financial Supervisory Service (FSS) decided to raise the capital market crisis level from 'caution' to 'alert' in response to the domestic stock market turmoil caused by the fear of the COVID-19 pandemic.

On the afternoon of the 13th, the FSS held a financial situation review meeting chaired by Senior Deputy Governor Kwang-Yeol Yoo. Referring to the upgrade of the capital market crisis level to alert, Senior Deputy Governor Yoo stated, "If necessary, the crisis response level for the entire financial market should also be raised and thoroughly addressed. We will prepare assuming the worst-case scenario for the time being."

He urged proactive monitoring of banks' foreign currency liquidity and foreign currency borrowing trends in preparation for the prolonged COVID-19 situation and emphasized thorough risk management of foreign currency assets.

He also ordered, "We must closely identify vulnerable links such as small business owners and self-employed individuals struggling due to COVID-19, companies facing temporary credit crunches caused by sharp sales declines and difficulties in refinancing corporate bonds, and respond proactively."

The FSS decided to exclude matters related to financial institutions' support for COVID-19 victims from future inspections.

Additionally, to facilitate swift support, cases where loan screening and procedures have been modified and applied will be included as reasons for exemption from liability for financial institution employees.

To ease the burden on financial institutions, the FSS plans to minimize on-site inspections during the first quarter, except for issues with significant consumer damage concerns.

This content was produced with the assistance of AI translation services.