[2025 Audit] KAMCO to Operate Its Own Debt Restructuring Program at Sae-Do-Yak Fund Level

On the 23rd, at the National Assembly's Political Affairs Committee audit held at the Busan International Finance Center (BIFC) in Nam-gu, Busan, Jung Jeong-hoon, President of the Korea Asset Management Corporation, is responding to lawmakers' questions. Photo by Yonhap News

Jung Jeong-hoon, President of the Korea Asset Management Corporation (KAMCO), stated on the 23rd, "For assets that do not meet the requirements of the Sae-Do-Yak Fund, we will operate our own debt support program at a level equal to or higher than that of the Sae-Do-Yak Fund."

President Jung made this remark at the National Assembly's Political Affairs Committee audit held at the Busan International Finance Center (BIFC) in Nam-gu, Busan, on the 23rd, in response to a question from Kim Namgeun, a lawmaker from the Democratic Party of Korea, who asked, "Is KAMCO not simply transferring its long-term delinquent bonds to the Sae-Do-Yak Fund?"

This month, the government launched the Sae-Do-Yak Fund, a bad bank that purchases long-term delinquent bonds that have been overdue for more than seven years and are valued at 50 million won or less. The Sae-Do-Yak Fund purchases qualifying delinquent bonds in bulk to support debtors who have lost repayment capacity, and then either writes off the debt or restructures it based on the debtor's ability to repay.

KAMCO plans to transfer bonds that meet the requirements to the Sae-Do-Yak Fund, while handling the remainder internally. President Jung explained, "For bonds that KAMCO holds internally, if they fit the operational program, we plan to more actively complete the statute of limitations on those bonds or write them off."

Regarding the possibility of the fund being discontinued, as has happened with previous bad banks, President Jung said, "There may be differences between the amount collected by the fund and the initially estimated amount, but there will never be a situation where the program cannot operate due to a lack of funds."

On the participation of the private lending industry in the Sae-Do-Yak Fund, he added, "The Korea Loan Business Association has joined the agreement," and "We will encourage as many private lenders as possible to join and will also discuss incentives."

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