Choo Kyung-ho: "Real Estate PF Troubled Projects... Inducing Normalization Through Lenders' Agreement"

Deputy Prime Minister and Minister of Economy and Finance Choo Kyung-ho stated on the 15th regarding the real estate PF (project financing) risk, "We are guiding orderly normalization through creditor consortium agreements for some sites with concerns of insolvency."

In his opening remarks at the 'Emergency Macroeconomic and Financial Meeting' held at the Seoul Banking Hall that morning, Deputy Prime Minister Choo said, "We are conducting a full survey of sites in cooperation with related agencies to monitor progress in real time, and most sites are proceeding normally with support such as operator guarantees."

Deputy Prime Minister Choo evaluated that the Korean financial market has recently shown an overall stable appearance. He explained, "The stock market has surpassed 2,600 points for the first time in about a year due to foreign net buying driven by expectations of semiconductor industry improvement. The exchange rate is also showing a relatively stable trend in the high 1,200 won range, and the money market is showing a favorable condition with continued interest rate stability."

Regarding the debt burden of self-employed and small business owners that increased during the COVID-19 period, he added, "A soft landing is underway following the maturity extension and repayment deferral measures implemented in September last year. The target debt decreased by 15 trillion won from 100 trillion won to 85 trillion won due to repayment completions following business improvements, and the remaining 85 trillion won has had maturities extended for three years until September 2025 in the case of maturity extension, with repayment deferral adjusted to allow installment repayments for up to five years."

Regarding the U.S. Federal Reserve's policy rate decision, Deputy Prime Minister Choo said, "Since uncertainties remain regarding the future monetary policy paths of major countries including the U.S., the government will maintain a high level of vigilance and closely monitor domestic and international financial markets." He also stated, "The Fed's announcement did not deviate from the Korean government's initial expectations and was in line with them."

Earlier, the U.S. Federal Reserve held its Federal Open Market Committee (FOMC) regular meeting on the 13th and 14th (local time) and kept the target range for the benchmark interest rate unchanged at 5.00-5.25%. However, Chairman Powell hinted at the possibility of additional hikes within the year.

Regarding Federal Reserve Chairman Jerome Powell's stance that "it is part of a pace adjustment and considering the high inflationary pressures, additional hikes within the year are appropriate," Deputy Prime Minister Choo said, "Since uncertainties remain regarding the future monetary policy paths of major countries including the U.S., the government will maintain a high level of vigilance and closely monitor domestic and international financial markets."

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