Yoon Seokheon Urges "Careful Review of Market Impact from Interest Rate Hikes... Fair Disciplinary Review for Opti and Lime"

Executive Meeting of the Financial Supervisory Service on the 2nd

[Image source=Yonhap News]

[Asia Economy Reporter Wondara] Yoon Seok-heon, Governor of the Financial Supervisory Service (FSS), urged fair disciplinary hearings regarding the Optimus and Lime fund incidents in preparation for market shocks due to rising global interest rates.

On the morning of the 2nd, at the FSS executive meeting, Governor Yoon said regarding the recent rise in commodity prices, oil prices, and global interest rates, "Since this could act as a market shock factor in a low-interest-rate environment, please carefully examine the potential impact on the overall market."

He also emphasized, "We must prepare for the possibility of asset price adjustments accordingly," adding, "We need to inspect and prepare for the potential deterioration of household and small business loans, and there should be no unjustified reduction in loans or interest rate hikes."

The U.S. 10-year Treasury yield rose from 0.91% at the end of last year to 1.07% at the end of January this year, and 1.46% as of the 26th of last month. The Korean 10-year government bond yield also increased from 1.17% at the end of last year to 1.77% at the end of January this year, and 1.88% as of the 25th of last month.

Regarding the ongoing disciplinary hearings for the Optimus and Lime funds, Governor Yoon said, "The disciplinary committee members who are conducting both hearings simultaneously are working hard," and requested, "Please continue to handle them consistently and fairly."

The second disciplinary hearing for NH Securities and Hana Bank, sellers of Optimus, is scheduled for the 4th, and the disciplinary hearing for Woori Bank, Shinhan Bank, and Shinhan Financial Group, sellers of Lime, is scheduled for the 18th. Governor Yoon also requested that, once the facts are confirmed, other private equity fund dispute resolution procedures be promptly pursued.

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