Bank CEOs Convene to Tackle the Tumultuous Financial Consumer Protection Act...

Chairman Eun Seong-su Holds Meeting with Major Bank CEOs on the 1st
Discusses Key Issues Including Financial Consumer Protection Act, Small Business Loans, and Real Estate Speculation Crackdown

[Asia Economy Reporters Sunmi Park and Seungseop Song] Amid a pile-up of banking industry issues such as the enforcement of the Financial Consumer Protection Act (FCPA), extension of loan maturities for small business owners, and eradication of real estate speculation, Eun Sung-soo, Chairman of the Financial Services Commission, convened major bank CEOs on the 1st. This was just a month and a half after holding a series of private meetings with the heads of the five major financial holding companies and policy banks in February to discuss the extension of loan maturities and interest payment deferrals in the financial sector.

According to financial sources, Chairman Eun met at 10 a.m. in the Korea Federation of Banks conference room with the CEOs of Kookmin, Shinhan, Woori, Hana, SC First Bank, and Industrial Bank of Korea, as well as deputy CEOs of Nonghyup and Jeonbuk Bank, and the deputy vice president of Busan Bank. The purpose was to actively request cooperation from bank CEOs for the smooth implementation of the FCPA, discuss the extension and soft landing measures for loan maturity extensions and interest payment deferrals for small business owners and SMEs effective from that day, contributions to funds for low-income financial services, and measures to prevent real estate speculation.

At the meeting, Chairman Eun expressed regret and sympathy for the burden on bank tellers and the confusion and inconvenience at the field level on the day the FCPA was enforced, but stated, “However, 'quickness' and 'consumer protection' are difficult to reconcile.” He added, “Although it may be burdensome immediately, if consumer protection is well implemented on the ground, it will have the effect of preventing heavy responsibilities such as CEO sanctions in the future. Let us take this opportunity to completely change the previous financial product sales practices and consider ways to stabilize the FCPA.”

He cited an example where a credit card company informed customers via messages about changes under the FCPA, which received a positive response, and suggested, “It would be good if the banking sector made similar efforts.” Currently, the financial authorities are operating a rapid response system for difficulties related to the FCPA in cooperation with financial industry associations, demonstrating their determination to provide swift and active support for the law’s stabilization.

Earlier, on the 26th of last month, just one day after the FCPA enforcement, Chairman Eun also convened heads of financial associations to listen to difficulties related to the law’s implementation and requested their cooperation.

Regarding the loan maturity extension measures for small business owners and SMEs effective from that day, Chairman Eun reminded major bank CEOs, “Please pay special attention to ensuring that customized consultations for borrowers at the counters are provided and that the decision on support eligibility does not take excessive time.”

He also announced that household debt management measures would be unveiled in April and requested, “Please work together to ensure the prompt stabilization of household debt management policies.” Regarding the amendment to the Low-Income Financial Services Act to be implemented in the second half of the year, he said, “With funds jointly contributed by the financial sector and the government, banks will also receive guarantee benefits and be able to provide loans (Hae-sal-lon Bank) to low-credit borrowers. Please understand that banks will also benefit from this.”

He requested efforts from the banking sector to prevent real estate speculation. He said, “It is important for the counters to make self-regulatory efforts to ensure sound lending, and there must be no connection between speculative real estate developers and bank employees.” He also urged, “Especially, loans related to speculators who are obligated to dispose of farmland should be promptly recovered.”

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