Eun Sung-soo: "Early Response on Ssangyong Motor Operating Fund Support... Considering Youth Loan Relaxation"

"Ssangyong Motor Operating Fund Support Requires Court Ruling"
"Loan Regulations Are Unrelated to Elections"

Financial Services Commission Chairman Eun Sung-soo is meeting with representatives of card companies, capital companies, and savings banks at the Korea Federation of Banks in Jung-gu, Seoul, on the 9th to discuss measures for the establishment of the Financial Consumer Protection Act and key issues. Photo by Moon Ho-nam munonam@

[Asia Economy Reporter Song Seung-seop] Eun Sung-soo, Chairman of the Financial Services Commission, bluntly stated regarding financial support for Ssangyong Motor, "It is still too early to answer the issue of working capital support."

On the 9th, right after a meeting with representatives from the card, capital, and savings bank industries, Chairman Eun met with reporters and was asked whether additional support would be provided through the Korea Development Bank if Ssangyong Motor enters rehabilitation proceedings. He replied, "Honestly, it is a matter of concern," adding, "That is why the court requested opinions from the creditors, and the creditors have also submitted their views." He continued, "The decision on working capital support can only be made after the court's judgment. Currently, discussions are ongoing on whether to initiate rehabilitation proceedings."

Earlier, the Korea Development Bank sent its opinion to the Seoul Bankruptcy Court regarding whether to commence rehabilitation proceedings for Ssangyong Motor. This followed the fact that HAAH Automotive, a major investor, did not submit a Letter of Intent (LOI) by the 31st of last month local time. It is expected that the court will decide to commence the rehabilitation proceedings as early as the beginning of next week.

Chairman Eun: "Household Debt Management and Young People's Homeownership Are 'Conflicting'"

Regarding the upcoming announcement of household debt management measures, Chairman Eun said, "We are currently in consultation with various ministries," and added, "If well agreed upon, it could be possible as early as next week." He explained, "The household debt growth rate was well maintained at the 4% level in 2019, but due to COVID-19, it surged to 7.9?8.0%. It is appropriate to return to the past growth rate of around 4%." As a specific measure, he said, "We will contribute to stabilizing household debt through the Debt Service Ratio (DSR) for each borrower."

At the same time, he acknowledged, "There have been criticisms and sympathy that if loan regulations are implemented based on income, low-income young people might lose the opportunity to own a home," and said, "The government and the ruling party are considering flexible lending policies specifically for this group." This implies that there is a dilemma on how to harmonize policies that stabilize household debt while allowing flexible loans for the youth.

However, when asked whether the flexible loan policy limited to young people was influenced by recent election results, he drew a line by saying, "This is a policy direction unrelated to the election," and added, "I cannot and will not comment on the election results."

Meanwhile, regarding the case where the Korea Deposit Insurance Corporation sold 2% of Woori Financial Group's shares through an underwriter, he commented, "I requested that public funds be recovered as much as possible and respect the decision." Chairman Eun said, "It was already decided to sell up to 10% over three years, but due to COVID-19, stock prices fell, and the plan could not be followed as intended." He explained, "If we do not sell, it means breaking the promise, and if we sell, it becomes difficult to recover public funds." He pledged, "This year and next year, we will implement measures to recover public funds as much as possible within the already announced framework."

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