[2020 National Audit] Eun Seong-su, Financial Services Commission Chairman, "Considering Expansion of DSR"

[Image source=Yonhap News]

[Asia Economy Reporter Hwang Yoon-joo] Eun Sung-soo, Chairman of the Financial Services Commission, stated on the 12th that "we are considering expanding the Debt Service Ratio (DSR) as a measure to manage household debt."

Chairman Eun made this remark during the National Assembly's Financial Services Commission audit by the National Assembly's Political Affairs Committee, responding to the Democratic Party lawmaker Oh Ki-hyung's concern that "jeonse loans and credit loans are rapidly increasing." The DSR is an indicator that calculates the principal and interest repayment burden on all loans of a borrower during loan screening.

Chairman Eun explained that jeonse loans are for ordinary citizens, saying, "We are hesitant to reduce or block jeonse loans because it would cause harm to someone."

He emphasized, "The DSR is beneficial both for borrowers, as it ensures borrowing within their capacity, and for the soundness of financial institutions."

Currently, a DSR regulation of 40% (60% for non-bank sectors) is applied individually to new mortgage loans secured by houses priced over 900 million KRW in speculative areas and speculative overheating districts.

Earlier, Deputy Prime Minister and Minister of Economy and Finance Hong Nam-ki also stated at the National Assembly audit on the 7th, "There is a need to expand the DSR to comprehensively control all types of loans."

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