Commissioner Go Seung-beom: "One More Extension for Maturity Extension and Repayment Deferral Measures for Small Business Owners"

On the 28th, Go Seung-beom, Chairman of the Financial Services Commission, attended a meeting with major commercial bank CEOs at the Korea Federation of Banks in Jung-gu, Seoul, where they discussed extending measures such as the maturity extension and interest repayment deferral for small business loans.

[Asia Economy Reporter Song Hwajeong] Ko Seung-beom, Chairman of the Financial Services Commission, expressed on the 28th his intention to extend the maturity extension and repayment deferral measures for small business owners once more.

Chairman Ko stated at a meeting with heads of commercial banks held at the Bankers' Hall that "the financial sector has implemented maturity extension and repayment deferral measures over the past two years to support small and medium-sized enterprises (SMEs) and self-employed individuals affected by COVID-19. However, due to the Omicron variant and other COVID-19 mutations causing a large-scale outbreak, the business conditions of SMEs and the self-employed have still not recovered to pre-COVID-19 levels." He added, "Accordingly, when the supplementary budget bill was passed by the National Assembly, the Assembly presented an opinion urging an additional extension of the maturity extension and repayment deferral measures as a supplementary opinion." Chairman Ko explained, "The government empathizes with the difficulties currently faced by the self-employed and, respecting the National Assembly's opinion based on bipartisan agreement, intends to actively consult with the financial sector to extend the maturity extension and repayment deferral measures once more."

Chairman Ko said, "Until now, the focus has been on overcoming the management crisis of the self-employed, but now it is time to pay attention to resolving the accumulated debt problems of the self-employed." He added, "Currently, the financial authorities are conducting detailed micro-analyses regarding the possibility of delinquency among self-employed borrowers, and based on the analysis results, we will discuss and prepare customized support measures suitable for the self-employed situation with the financial sector."

Regarding household debt, he urged continuous management. Chairman Ko stated, "The accumulated financial imbalance problem caused by the rapidly increasing household debt remains a latent risk factor for our economy, so continuous management is necessary going forward." He added, "With the expansion of the Debt Service Ratio (DSR) at the borrower level earlier this year as a turning point, we will strengthen system management and continue to promote qualitative soundness of household debt, such as spreading the practice of installment repayment."

Furthermore, Chairman Ko announced that institutional conditions will be established to help banks discover future growth engines. He said, "Banks must strengthen efforts to respond to the changing financial environment and discover future growth engines." He emphasized, "The government will actively support new attempts by the banking sector for innovation and development. First, we will create institutional conditions for digital transformation, including the establishment of a digital universal bank." Along with this, he added, "We will also improve regulations on banks' concurrent and incidental businesses and ownership of subsidiaries to allow banks to autonomously design various business models."

Regarding the Ukraine situation, Chairman Ko said, "Although our financial companies' exposure to Russia is not large, it is necessary to thoroughly prepare in advance, including foreign currency liquidity management, to cope with the possibility of crisis expansion." He urged, "In particular, please actively work to minimize the difficulties faced by our companies and citizens operating in Ukraine and Russia due to this situation."

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