Eun Sung-soo: "LH Scandal is Serious... Will Review Regulation on Second Financial Sector Land Loans"

Advanced Measures for Household Debt Management Are Under Consultation with Relevant Ministries

[Image source=Yonhap News]

[Asia Economy Reporter Ki Ha-young] Eun Seong-su, Chairman of the Financial Services Commission, stated regarding the land speculation allegations involving employees of Korea Land and Housing Corporation (LH), "We recognize the seriousness and gravity of the matter," and added, "We will also examine whether there are any issues in loans related to the secondary financial sector, not the banking sector, and in land, not housing."

Chairman Eun made these remarks on the 11th after a meeting with investment companies of the New Deal Fund No. 1 held in Yongin, Gyeonggi Province. He said, "We received a request from the joint investigation headquarters to dispatch Financial Services Commission staff for the LH investigation," and added, "We will send highly capable personnel to actively cooperate and contribute to the investigation."

Chairman Eun also stated that the Financial Services Commission has not yet received specific information regarding LH employees involved in speculation. He added that it is a matter for the joint investigation unit, which has investigative authority, to conduct the investigation, and the Financial Services Commission does not have the authority to investigate.

Regarding loans related to LH speculation occurring at local agricultural cooperatives, he said, "There are calls for regulations on the land sector as well," and emphasized, "So far, we have mainly focused on the banking sector and housing mortgage loans, but going forward, we will check whether there are any issues in the secondary financial sector, not the banking sector, and in land, not housing."

Chairman Eun responded that he is currently consulting with related ministries on the advanced household debt management plan scheduled to be announced this month. He explained, "If loan standards are tightened, debt can be reduced, but there may be criticism that it removes the ladder of opportunity. If flexibility in lending is given only to young people, it could be seen as contrary to the policy stance of curbing speculation," and added, "Since the positions of each ministry differ, we will listen to opinions before making an announcement."

Regarding the approval of Mahindra's capital reduction as the major shareholder of Ssangyong Motor, he said that one should neither be too optimistic nor pessimistic. He stated, "Since the approval of Mahindra's capital reduction was the biggest issue in resolving the Ssangyong Motor crisis, I think it is a good start," but added, "That does not mean the Ssangyong Motor issue is resolved, so we will work hard to ensure it is properly resolved."

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