Lee Ju-yeol "Financial Sector Must Prepare for Possible Expansion of Credit Risk Centered on Self-Employed"

'2022 New Year's Address from the Financial Sector'

[Image source=Yonhap News]

[Asia Economy Reporter Jang Sehee] Lee Ju-yeol, Governor of the Bank of Korea, urged thorough risk management.

On the 4th, through the "2022 New Year's Address to the Financial Sector," Governor Lee stated, "During the normalization process of financial easing measures, there is a possibility that credit risk may expand, especially among some households and self-employed individuals facing excessive leverage and sluggish business conditions."

He added, "In a situation where domestic and international uncertainties are very high, these internal vulnerabilities can act as weak links in the financial system, so we must pay close attention and prepare for potential risks."

Governor Lee identified the "spread of COVID-19 variants" as the greatest threat to our economy. He said, "Concerns about external risks are also increasing, such as rising global inflationary pressures, the normalization of monetary policies by major countries, and the possibility of China's economic slowdown," adding, "Structural vulnerabilities in our economy, such as accumulated debt and asset inequality after the pandemic, have deepened."

He continued, "We must keep in mind that securing digital competitiveness in the financial sector is not only a prerequisite for future finance but also a crucial task directly linked to building a stable financial system."

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