[2020 National Audit] "No New Loans from Policy Banks' Private Lending? Still Acting as 'Jeonju'"

Over the Past 4 Years, Saneun Capital Lent 218.5 Billion KRW and Kieun Capital 190.1 Billion KRW to Loan Companies
Loan Companies Borrow at 3-5% Interest and Lend at High Rates of 24%... Earned 3.8058 Trillion KRW Last Year

Eun Sung-soo, Chairman of the Financial Services Commission, attended the audit of the Financial Services Commission held by the Political Affairs Committee at the National Assembly on the 4th and is talking with Yoo Dong-soo, Democratic Party's secretary./Photo by Yoon Dong-joo doso7@

[Asia Economy Reporter Jo Gang-wook] It has been revealed that capital companies under state-run banks, which had pledged not to provide new loans to loan companies, have continued to execute loans this year as well.

According to data received on the 16th from Korea Development Bank Capital and IBK Industrial Bank of Korea by Yoo Dong-soo, a member of the National Assembly's Political Affairs Committee from the Democratic Party of Korea, they have supplied 409.5 billion won in low-interest loans to loan companies over the past four years.

Rep. Yoo stated, "Despite previous criticisms during the national audit, from 2019 to the end of August this year, Korea Development Bank Capital and IBK Industrial Bank have executed 26 new loans totaling 69.1 billion won to loan companies," adding, "Loan companies secured funds through these two institutions at low interest rates of 3-5%, then provided high-interest credit loans up to 24% to ordinary citizens, earning 3.8058 trillion won in revenue last year alone."

In fact, Korea Development Bank Capital executed 11 new loans worth 47 billion won to loan companies from last year to the end of August this year. During the same period, IBK Industrial Bank provided 15 loans totaling 22.1 billion won to loan companies. The outstanding balance of new loans from Korea Development Bank Capital (47.9 billion won) has decreased by more than half compared to 88 billion won in 2017 and 78 billion won in 2018. However, IBK Industrial Bank's outstanding loan balance to loan companies increased from 47.9 billion won in 2018 to 52.5 billion won at the end of this year.

Rep. Yoo emphasized, "State-run banks, which should focus on minimizing COVID-19 damage and normalizing the national economy, have forgotten their raison d'?tre and are acting as 'jeonju' (loan brokers) for loan companies," urging, "They must operate in accordance with the purpose of their establishment, and further new loans should be refrained from."

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