[2023 National Audit] Financial Services Commission Chairman "Thorough Household Debt Management... DSR Supplementation, Policy Mortgage Adjustment"

National Assembly Political Affairs Committee Audit on the 11th

Financial Services Commission Chairman Kim Ju-hyun holds a press conference on the first anniversary of his inauguration at the Government Seoul Office in Jongno-gu, Seoul, on the 7th. Photo by Yoon Dong-joo doso7@

On the 11th, Kim Joo-hyun, Chairman of the Financial Services Commission, identified "financial market stability" as the first major policy this year during the National Assembly's Finance and Economy Committee audit, stating, "We will make every effort to manage the quantity and quality of household debt."

He assessed that "household debt, which had decreased since the second half of last year, has recently started to increase again." He added, "We are continuously supplementing and improving the DSR (Debt Service Ratio) system to ensure that loans are taken within the repayment capacity and repaid in installments from the beginning. We also raised the interest rates on the special Bogeumjari Loan and suspended the general special Bogeumjari Loan to adjust the supply speed of policy mortgages."

He also mentioned policies for the smooth landing of the real estate project financing (PF) market. Chairman Kim said, "We are implementing the '50 trillion won + α liquidity supply program' announced last year to respond to instability in the real estate PF market," and added, "In September this year, we prepared additional support measures exceeding 20 trillion won, including expanding funding for normal business sites and promoting restructuring of PF sites lacking feasibility."

Furthermore, he stated, "We have enhanced the soundness of the financial sector through capital expansion and strengthened provisioning in the banking sector," and said, "We are also supporting the prompt normalization of insolvent companies by expanding Kampo's funding support for workout companies and additionally raising the Corporate Restructuring Innovation Fund." The Financial Services Commission plans to reorganize a permanent corporate restructuring system by promoting the re-legislation of the 'Corporate Restructuring Promotion Act.'

To support the real economy and people's livelihoods, they plan to supply policy finance worth 91 trillion won. The supply targets include 'support for global super-gap industries,' 'fostering future promising industries,' 'business restructuring and industrial structure advancement,' 'nurturing unicorn ventures, small, and medium-sized enterprises,' and 'resolving management difficulties caused by the three high phenomena.' Chairman Kim said, "We have expanded the scale of policy finance for low-income households from the initial 10 trillion won by more than 1 trillion won and are implementing small livelihood loans to alleviate financial difficulties of vulnerable borrowers."

Regarding the development of the financial industry, he said, "To respond to rapidly changing environments such as digital transformation and AI, we are reorganizing the financial security regulatory system based on principles and strengthening post-responsibility. We are supporting the fintech industry by establishing a fintech innovation fund." He also stated, "We are creating an investment environment where general investors can trust and invest through measures such as pre-disclosure of insider trading and mandatory tender offer systems, and we are continuously advancing the capital market by abolishing the foreign investor registration system and improving dividend procedures."

The Financial Services Commission also improved regulations that hinder domestic financial companies' overseas expansion this year, such as 'improving the ownership scope of overseas non-financial subsidiaries of financial companies' and 'granting additional credit limits to overseas subsidiaries in the early stages of overseas expansion.'

Chairman Kim said, "To prevent the recurrence of frequent financial accidents and effectively improve internal controls of financial companies, we will actively participate in discussions on the amendment of the 'Financial Company Governance Act' proposed in September this year," and added, "We will also faithfully prepare subordinate regulations for the 'Virtual Asset User Protection Act,' which will be enforced from July next year, to protect virtual asset users and establish trading order in the virtual asset market."

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