Lee Bok-hyun "DSR Regulation Principles Remain Unchanged... Flexible Approach to Jeonse Fraud"

1st Anniversary Press Conference of Inauguration

Lee Bok-hyun, Governor of the Financial Supervisory Service (FSS), stated on the 1st regarding the easing of the Debt Service Ratio (DSR) regulation, "The DSR regulation will not take a stance that significantly shakes its fundamental principles."

At a press conference marking his first anniversary in office, Governor Lee said, "We can be flexible with targeted policies such as the jeonse fraud issue," but drew a clear line on easing the DSR regulation.

Earlier, on the 30th, Deputy Prime Minister and Minister of Economy and Finance Choo Kyung-ho told reporters, "I have heard that many people are facing genuine difficulties with loans related to jeonse deposit return guarantees," and added, "We will consider limited easing of loan regulations in this regard." Deputy Prime Minister Choo's remarks were interpreted as accepting landlords' demands to ease DSR regulations on loans intended for deposit returns.

Regarding this, Governor Lee said, "We are simulating various scenarios on how debt changes, borrower burdens, and landlords will be affected by several proposals related to jeonse payments," but added, "However, I am not in a position to provide more details on timing or methods beyond Deputy Prime Minister Choo's remarks." He emphasized, "I, along with the Deputy Prime Minister and the Financial Services Commission Chairman, repeatedly state that the fundamental principle of the DSR regulation should not be expected to be relaxed."

On the household debt issue, Governor Lee explained, "Since the tenure of former Financial Services Commission Chairman Ko Seung-beom, there has been a consistent awareness that the speed and quality of expansion cannot continue as is," adding, "While credit loans are on a declining trend and some mortgage loans such as special housing loans have increased, the overall trend is downward." He continued, "We have reached a consensus that establishing long-term fixed interest rates is crucial so that borrowers are not adversely affected during periods of rapid interest rate changes," and added, "The broad policy direction is naturally to reduce the expansion trend."

Reflecting on his first anniversary in office, Governor Lee said, "We have encouraged the financial sector to actively extend hands of coexistence and, together with the industry, have drawn a blueprint for the globalization of Korean finance, strengthening our resolve," and stated, "Going forward, we will proactively respond to downward economic pressures and potential risks such as real estate project financing (PF) to maintain the stability of the financial system."

Regarding rumors about running in the general election and his future plans, he said, "Given the market situation, it is difficult for any one of the four institutions (Ministry of Economy and Finance, Financial Services Commission, Financial Supervisory Service, Bank of Korea) to suddenly change leadership," but added, "Since I was appointed by the appointing authority, I cannot insist on staying for the full three-year term."

Meanwhile, Governor Lee, the first former prosecutor and the youngest ever to lead the FSS, has shown a strong presence over the past year. A former special prosecutor for corporate and financial crimes, he is regarded as the youngest and a key member of President Yoon Suk-yeol’s faction. Notably, he led banking reforms that began with President Yoon’s criticism of the 'money feast' in February and personally held meetings to promote win-win finance. He has maintained an active schedule visiting the four major commercial banks, regional banks such as Busan, Daegu, and Gwangju banks, as well as internet-only banks.

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