Government: Domestic Financial Firms' Exposure to Chinese Real Estate at 400 Billion Won... Measures to Be Taken If Necessary

The government recently stated on the 20th that although the impact of the Chinese real estate crisis on the domestic market is limited, it will promptly implement market stabilization measures when necessary.

Deputy Prime Minister and Minister of Economy and Finance Choo Kyung-ho held a meeting on the 20th at the Korea Federation of Banks building in Jung-gu, Seoul, with Lee Chang-yong, Governor of the Bank of Korea, Kim Ju-hyun, Chairman of the Financial Services Commission, Lee Bok-hyun, Governor of the Financial Supervisory Service, and Choi Sang-mok, Senior Secretary for Economic Affairs. They focused on reviewing recent major global economic and financial issues and their impacts.

From left: Lee Bok-hyun, Governor of the Financial Supervisory Service; Kim Ju-hyun, Chairman of the Financial Services Commission; Deputy Prime Minister Choo Kyung-ho; Lee Chang-yong, Governor of the Bank of Korea; Choi Sang-mok, Senior Secretary for Economic Affairs, Office of the President. [Photo by Yonhap News]

On the same day, Deputy Prime Minister and Minister of Economy and Finance Choo Kyung-ho held a meeting at the Seoul Federation of Banks building with Bank of Korea Governor Lee Chang-yong, Financial Services Commission Chairman Kim Ju-hyun, Financial Supervisory Service Governor Lee Bok-hyun, and Senior Secretary for Economic Affairs Choi Sang-mok to review recent economic and financial issues and their impacts.

They noted that uncertainties in global financial markets have increased due to difficulties in the Chinese real estate sector and heightened volatility in the U.S. Treasury market, but assessed that the impact so far remains limited. They also judged that the exposure of domestic financial institutions to Chinese real estate developers amounts to 400 billion KRW, which is not significant.

Nonetheless, the participants agreed that future domestic impacts cannot be ruled out, and decided to further strengthen real-time monitoring of major risk factors through the intergovernmental joint economic situation inspection team, which has been operating since the second half of last year. Additionally, they agreed to re-examine contingency response plans and, when necessary, swiftly implement market stabilization measures in cooperation with relevant agencies.

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