Financial Supervisory Service Summons Executives of Commercial Banks Again Over Household Loans, Pressuring "Reduce Lending Further"

"Will Soon Negotiate with Banks with Excessive Household Loan Targets to Adjust Target Levels"

[Asia Economy Reporter Wondara] The Financial Supervisory Service (FSS) has urged banks with a sharp increase in household loan targets among 17 banks to "reduce their loan targets." This action follows an analysis based on the household loan targets submitted by each bank.

An FSS official said in a phone interview with Asia Economy on the 28th, "We convened the deputy heads in charge of household loans from 17 banks for an urgent video conference on household loan inspection." He added, "At the meeting on the 11th, we had just received annual loan target data from each bank, so the request was to manage according to the targets. In this recent meeting, after reviewing those numbers, we asked banks with excessively high targets to reduce them." He further explained, "We said we would negotiate with banks whose target growth rates are excessive, but no specific dates for negotiations have been set."

Previously, the FSS held meetings with credit officers in September and November of last year, as well as on the 11th of this month. This is the second household loan meeting this month, interpreted as a sign that the FSS intends to actively manage household loans, given the surge in household loans last year and the expectation of increased loan demand due to 19 initial public offerings (IPOs) scheduled consecutively in January and February this year.

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