NongHyup Bank Group Loans to Be Covered by Shinhan Bank

A loan counter at a commercial bank in downtown Seoul

[Asia Economy Reporter Kwangho Lee] Shinhan Bank has agreed to cover group loans (balance loans) for apartment projects contracted with NH Nonghyup Bank.

According to the financial sector on the 31st, Nonghyup Bank recently requested Shinhan Bank to share the demand for group loans, and Shinhan Bank accepted the request.

A Shinhan Bank official said, "This is inter-bank cooperation to ensure the smooth execution of group loans for actual demanders," adding, "The specific method of loan sharing is under discussion."

Since August, Nonghyup Bank has suspended all new real estate-related loans, including mortgage loans and balance loans, because the household loan growth rate exceeded the financial authorities' recommended level of 6%. On the other hand, as of the 28th, Shinhan Bank's household loan growth rate was 4.06%, the lowest among the five major commercial banks.

Earlier, the financial authorities inspected 110 projects to ensure there would be no disruption in supplying group loans to actual demanders, and decided to establish a cooperative system among banks to support loans if any issues arise. Additionally, next year, they plan to strengthen the responsibility of bank CEOs to prevent loan suspension incidents like those this year.

The financial authorities required commercial banks to prepare and submit loan plans to ensure annual loans proceed without interruption. In particular, when submitting household debt management plans by financial companies, reporting to the CEO and the board of directors is mandatory, effectively making the CEO responsible for preventing loan suspensions or first-come, first-served loan incidents.

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