Ministry of the Interior and Safety Conducts Special Inspection of 30 Saemaeul Geumgo with Over 10% Delinquency Rate

Announcement of Special Measures to Reduce Delinquency Rates

The government has decided to conduct a joint special inspection targeting 30 individual Saemaeul Geumgo branches with delinquency rates exceeding 10%. Additionally, it plans to pursue branch closures or mergers if necessary.

On the 4th, the Ministry of the Interior and Safety (MOIS) announced special measures to reduce the delinquency rate of Saemaeul Geumgo at the Government Complex Sejong. MOIS is the supervisory agency for Saemaeul Geumgo.

As part of the special measures, MOIS selected 100 Saemaeul Geumgo branches with the highest delinquency rates for focused management. Among them, 30 branches with delinquency rates exceeding 10% will undergo special inspections, and 70 branches will be subject to special audits. The inspection and audit period will last five weeks, from the 10th of this month to the 11th of next month. Based on the results of the inspections and audits, MOIS may take actions such as demanding mergers or suspending executives from their duties.

The inspection and audit team will consist of 30 personnel from MOIS, the Financial Supervisory Service, the Korea Deposit Insurance Corporation, and the National Saemaeul Geumgo Federation. The inspection and audit items include each branch’s delinquency rate as of the end of June, delinquency reduction targets, and weekly progress status.

MOIS will also implement a system assigning responsibility by business site and regional headquarters for 87 business sites with joint loan delinquencies exceeding 20 billion KRW (totaling 3.2 trillion KRW).

Kim Kwang-hwi, Regional Economic Support Officer at MOIS, stated, "As of June 29, the delinquency rate stands at 6.18%. We will strive to reduce it to below 4%, the level at the end of last year."

Alongside this, the government plans to sell off a total of 1.2 trillion KRW worth of non-performing loans by the end of this year.

The soundness regulation level will also be raised to match that of other mutual financial institutions. The liquidity ratio will be maintained at 80% or higher, consistent with other institutions, and loan limits for real estate and construction sectors will be capped at 30% each, with a combined limit of 50%. The loan loss provision ratio for real estate and construction loans will also be expanded to 130%.

Furthermore, MOIS announced that it will temporarily operate only loans that can be normalized by the end of this year.

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