Financial Services Commission Chairman Ko Seung-beom Reiterates "All Means Will Be Used to Manage Household Debt"

Inaugural Address of the Financial Services Commission Chairman

New Financial Services Commission Chairman Ko Seung-beom is attending the Cabinet meeting held at the Government Seoul Office in Jongno-gu, Seoul on the 31st. Photo by Hyunmin Kim kimhyun81@

[Asia Economy Reporter Kim Jin-ho] Ko Seung-beom, Chairman of the Financial Services Commission, reiterated on the 31st, "We will mobilize all means to eliminate the risk factors inherent in the rapidly increasing household debt and focus our policy capabilities."

Chairman Ko said this during his inauguration speech at the Government Seoul Office, stating, "Household debt poses a risk of undermining macroeconomic and financial market stability."

In his inauguration speech, Chairman Ko first emphasized that the normalization of financial and monetary policies in major advanced countries, starting with the Bank of Korea's base rate hike, is an inevitable process, warning that the previous asset price increases driven by leverage and the unchecked expansion of private credit are no longer possible.

He went on to say that behind major financial crises such as the 1997 International Monetary Fund (IMF) foreign exchange crisis and the 2008 global financial crisis lies the accumulation of excessive debt. Referring to the recollection of Sir Adair Turner, former Chairman of the UK Financial Services Authority (FSA), who said, "Even just a week before starting his duties as chairman during the 2008 global financial crisis, he did not realize the disaster was imminent," he made this point.

Therefore, he stressed the need to sever the mutually reinforcing link between the excessively increased household debt and the overheated capital market starting now. Chairman Ko declared, "We will enhance the effectiveness of the announced measures and mobilize all means to eliminate the risk factors inherent in the rapidly increasing household debt."

Regarding cryptocurrency exchanges facing the risk of mass closures, he clearly stated that "the deadline for reporting under the Special Act on Reporting and Use of Certain Financial Transaction Information (Special Act) will not be extended," saying, "It can no longer be avoided or postponed." He added, "We must minimize unpredictable damage that may occur to transaction participants," and "We will focus on international consistency and protection of citizens' property rights while also considering fundamental institutional improvements."

He also emphasized the need to foster innovation for the future development of the financial industry. Chairman Ko said, "We must not hesitate due to uncertainty when preparing for significant future changes," adding, "We will boldly imagine, analyze meticulously, and institutionally support new changes."

Specifically, he mentioned ▲redefining the regulatory framework ▲the financial intermediation function ▲and financial consumer protection. He said, "First, it is essential to explore cooperation methods among big tech, fintech, and existing financial sectors," and "(Along with such innovation) we will focus on promoting trust through financial consumer protection."

Finally, Chairman Ko urged Financial Services Commission staff to engrave pride and determination that will determine financial market stability and financial industry development. He said, "Let's create practical financial policies that can solve real problems," and "We need a humble attitude that listens to the voices of the people, starting with closer policy cooperation with policy partners."

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