Press Releases - Financial Services Commission

Press Releases

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Aug 17, 2022

Private-Public Joint Taskforce on Digital Asset Holds Kickoff Meeting

The FSC announced that a private-public joint taskforceon digital asset consisting of private sector experts, relevant government authorities and institutions was launched on August 17 and held its kickoff meeting chaired by FSC Vice Chairman Kim So-young. The government has actively responded to digital asset related issues through vice ministerial meetings organized by the Office for Government Policy Coordination thus far. In particular, by seeking an enactment of a framework law on digital asset, the new administration has been working on ways to promote a proper balance between innovation based on new technology such as blockchain and consumer protection and financial stability. A private-public joint taskforce on digital asset was launched in this regard to promote discussion and sharing of information between private sector experts, relevant government authorities and related institutions in seeking government-wide collaboration for legislative efforts. Through operation of a taskforce, authorities plan to comprehensively review the following issues(a) the legal characteristics and the rights relationship regarding digital assets and ways to respond to digital asset related crimes, (b) digital assets and financial stability, central bank digital currency (CBDC) and taxation issues, (c) regulatory framework for digital asset issuance and distribution markets and (d) ways to promote the blockchain industry. Summary of Vice Chairmans Opening Remarks In his opening remarks, Vice Chairman Kim So-young stated that the new administration has been engaging in discussions from multifaceted perspectives to support innovation based on blockchain technology while creating an environment to foster responsible growth of the digital asset market. A research commissioned to examine relevant issues and response strategies based on a comparative analysis of various digital asset related bills pending at the National Assembly and overseas legislative trends was completed in ear
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Aug 11, 2022

FSC Plans to Introduce Small Business Loan Refinancing Program

The FSC announced its plan to introduce a small business loan refinancing program worth KRW8.5 trillion to help lower interest payment burdens of self-employed business owners and small merchants. Background In the process of dealing with the COVID-19 pandemic, the size of loans for the self-employed and small merchants increased as well as their debt service burdens, and the qualitative structure of their loans deteriorated with an expansion in high interest rate loans from nonbank sectors. Recent interest rate hikes resulting from an accelerated pace of monetary tightening in major economies has resulted in added debt servicing burdens for the self-employed and small merchants. As such, small businesses hit by a protracted pandemic are experiencing difficulties in normalizing their business operation while making payments on high interest rate loans at the same time. At the 2nd emergency meeting for stabilizing peoples livelihoods held on July 14, the government introduced comprehensive support packages for self-employed business owners and small merchants in the amount of KRW80 trillion as shown below. a) (For Borrowers with Repayment Capability) KRW41.2 trillion in financing support for liquidity provision and to help boost their business competitiveness (already announced on July 25) b) (For Borrowers Having Difficulties with High Interest Rates) KRW8.5 trillion in refinancing support with low interest rate loan (included in todays announcement) c) (For Borrowers without Repayment Capability on Their Own) KRW30 trillion worth New Start Fund to be set up for debt adjustment support through principal payment reduction, etc. (to be announced in mid-August) Today, the FSC is announcing specific plans for introducing a low interest rate refinancing program in the amount of KRW8.5 trillion to help alleviate the self-employed and small merchants payment burdens with high interest rate loans. Key Details of Low Interest Rate Refinancing Program I. Eligibility The low i
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Aug 10, 2022

Household Loans, July 2022

In July 2022, the outstanding balance of household loansacross all financial sectors fell KRW1.0 trillion, showing a stable trend as the growth seen in Q2 turned back lower.The financial authorities will make efforts for a stable management of the household debt growth while working on effective implementation of the normalization of household loan regulations to help alleviate financing difficulties of non-speculative homebuyers. (Overall) Household loans across all financial sectors dropped KRW1.0 trillion in July 2022. The growth rate (up 1.7%, y-o-y) has continued to stay on a downward path since the second half of 2021. (By Type) Mortgage loans expanded at a slower pace than the previous month and other types of loans dropped at a greater level, contributing to the overall decline in household loans. - (Mortgage Loans) Mortgage-backed loans rose KRW2.5 trillion in July, slowing down from KRW2.8 trillion in the previous month. - (Other Types of Loans) Other types of loans dropped KRW3.6 trillion in July, falling at a faster rate compared with the previous month (down KRW2.1 trillion). (By Sector) Household loans in both the banking and non-banking sectors turned lower, but the growth trend continued in the savings bank (up KRW0.4 trillion) and insurance (up KRW0.2 trillion) sectors. - (Banking Sector) Banks saw a drop of KRW0.3 trillion in household loans. Mortgage loans from banks grew KRW2.0 trillion,rising from KRW1.4 trillion a month ago, as group lending for new apartment subscription and jeonse loans rose KRW1.3 trillion and KRW1.1 trillion, respectively. Other types of loans fell KRW2.2 trillion, declining at a faster rate from a month ago (down KRW1.2 trillion) as credit loans fell KRW1.9 trillion. -(Non-Banking Sector) In July, nonbanks saw a drop of KRW0.8 trillion in household loans, led by declines in the mutual finance (down KRW1.2 trillion) and specialized credit finance (down KRW0.2 trillion) sectors. (Assessment) Household loans across all financ
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Aug 08, 2022

FSC Unveils Financial Policy Agenda of the New Administration

FSC Chairman Kim Joo-hyun presented the new administrations financial policy agenda to President Yoon Suk Yeol on August 8 which focuses on preemptive handling and management of crisis and providing steady reinforcement for the revitalization of the financial industry and economy beyond crisis. Financial Policy Agenda I. Financial Measures to Stabilize Peoples Livelihoods in Vulnerable Sectors a) Background - Pursue prompt implementation of the KRW125 trillion-plus financial measures to help stabilize peoples livelihoods - Seek additional measures in preparation for SMEs facing difficulties b) Key tasks [Task #1] Effective implementation of the financial sector measures to help stabilize peoples livelihoods Authorities will strengthen efforts for promotion and consultation activities and establish a close-knit coordination network with relevant government ministries and institutions. - Strengthen promotion and consultation efforts customized for each beneficiary group to help ensure that there is no one left out from receiving assistance due to the lack of awareness about the availability of the support programs - Improve synergetic effects (consultation funding support offered) through collaboration with the small merchant support program provided by the Ministry of SMEs and Startups - Maintain close communication with the financial sectors and media. [Task #2] Response to potential management and financing difficulties of Small and Medium-sized Enterprises Authorities will prepare financial support measures to help resolve the difficulties of SMEs such as increases in inflation, interest rates and prices of raw materials. 1) Make newly available (KRW6 trillion) government-backed fixed rate loans with low interest rates 2) Provide preferential interest rate support for loans and guarantees to businesses that are highly dependent on raw material imports or those experiencing difficulties due to disruption in global supply chain 3) Make adjustment to the accounting r
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Aug 04, 2022

FSC Plans to Promote the Use of Artificial Intelligence in Financial Services

Vice Chairman Kim So-young presided over a meeting with relevant industry officials and experts on August 4 and held discussions on ways to promote the use of artificial intelligence (AI) in financial sectors and ensure public trust in financial services based on AI. Some of the key measures of the plan include the following. a) Building an AI data library that allows pseudonymized data to be reused b) Issuing detailed guidelines for AI development and usage in five specific areas c) Granting an exemption of the network separation rule on the development and test servers using pseudonymized data d) Building an AI testbed to support data and computing resources for testing e) Establishing an AI-based credit evaluation model and a process for verifying the security of AI-based services. Summary of Vice Chairmans Remarks In his opening remarks, Vice Chairman Kim emphasized the importance of making advancement in AI technology to make effective use of the exponentially increasing availability in big data amid hyperconnected networks and the hyperconvergence and big blur phenomena. To help realize success in digital financial innovation, Vice Chairman Kim said that financial regulatory reforms need to take place to ensure that financial sectors can make use of big data and AI technology effectively. In this regard, digital financial innovation based on the promotion of the use of big data and AI will help to (a) boost consumer convenience by allowing more customized financial services to be introduced, (b) strengthen the function of financial intermediation services, (c) improve financial institutions risk management functions through enhancement of analysis and assessment and (d) increase the access to financial services and enhance financial inclusion for vulnerable groups such as individuals with thin credit history. To this end, the FSC will make active efforts to remove barriers that stand in the way of making use of AI in financial services. First, by building a fi
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Aug 03, 2022

FSC Announces Measures to Strengthen Financial Support for Business Transformation

The FSC unveiled a plan to provide financial support in the amount of about KRW1 trillion to companies pursuing business transformation to cope with changing digital and environmental conditions in order to help domestic companies regain their competitiveness edge and expand their business areas. Background In the process of responding to the COVID-19 pandemic, the rapidly changing business conditions such as digital transformation and carbon net zero movement have necessitated businesses to make changes at a greater level. Considering a slowdown in the level of business productivity, it has become necessary for companies to proactively seek structural transformation of their business in order to enhance the level of competitiveness. Measures to Support Business Transformation Currently, the Ministry of Trade, Industry and Energy (MOTIE)s standards for approving business transformation activities and the evaluation standards used by financial institutions remain different, so that it has been difficult to provide financing support to those that have been approved by MOTIE. Therefore, authorities will strengthen the pre-selection process to ensure that businesses that are eligible to receive financial assistance are selected as the entities pursuing business transformation by introducing a two-staged evaluation process (evaluation of disqualification criteria and evaluation of technological prowess). a) The business transformation support center will examinethe financial conditions of applicants and determine whether there are any reasons for disqualification. b) A technology credit bureau (TCB) will examine and determine the technological prowess and the viability of business model for those that have passed the evaluation of disqualification criteria. Through TCBs technology appraisal,the feasibility of new business model will be evaluated such as the potential for expanding sales, operating profit, etc., and the capability for capital expansion will be evaluated b
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Jul 28, 2022

Improving Short Selling System and Strengthening Oversight and Punishment for Illegal Activities

FSC Chairman Kim Joo-hyun presided over a joint meeting with relevant institutionson July 28 and announced the measures to improve the stock short selling system and strengthen oversight and punishment on illegal short selling activities. At the meeting, participants shared the same view that investors growing concerns about the use of short selling in illegal transactions and the ineffective oversight and punishment on illegal short sale activities need to be resolved in order to restore investors trust in domestic stock markets.In this regard, through joint efforts, authorities agreed to strengthen oversight, detection and punishment of illegal short selling activities and promptly pursue improvements to the short selling system to stamp out illegal short selling activities. Overview of the Meeting A joint meeting to stamp out illegal short selling activities was held on July 28 chaired by FSC Chairman Kim Joo-hyun. As investors mistrust toward the short selling system continues to grow with recent declines in global stock markets, the meeting was held as the authorities deemed it necessary to (a) promptly address the need to bolster oversight and punishment over market disturbing activities in capital markets through illegal short selling activities and short selling-based price rigging and (b) discuss and announce the measures for bringing about prompt improvements to the short selling system to help address the issues raised by investors. Background Short selling involves a sale of borrowed stocks. As an investment strategy aimed at gaining profits or avoiding losses when stock prices fall, it is an investment method generally allowed in markets across all advanced economies.Short selling helps to increase market liquidity and prevent formation of bubble in stock prices. However, in the wake of the COVID-19 crisis in March 2020, a short selling ban was introduced to help ease market anxieties. Since the introduction of short selling ban, various improvements ha
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Jul 26, 2022

FSC Announces Plan to Introduce Insolvency Resolution Mechanism for Financial Institutions

The FSC announced a plan to introduce an insolvency resolution mechanism for financial institutions (tentatively called financial stability account) to help prevent insolvency of financial institutions. The plan was discussed at the financial risk response taskforce meeting held on July 26. With changes in financial market environment, there have been calls for introducing a mechanism that can help protect financial institutions against insolvency and prevent risks from spreading in advance. In the wake of the 2008 global financial crisis, major economies such as the U.S., EU and Japan established such preventive support systems. In this regard, the FSC is considering ways to introduce an insolvency resolution mechanism for financial institutions (tentatively called financial stability account)for insolvency prevention of financial institutions through liquidity provision and capital expansion. The FSC will prepare a detailed plan after coordinating with relevant ministries and institutions and gathering opinions from experts and seek revision to the Depositor Protection Act accordingly. Background With some of the changes taking place in the financial industry such as the growth of the nonbank sector, deepening interconnectedness between financial sectors and unpredictability in shock originating from the real economy sector, there is growing concern about risks in certain areas spreading across the entire financial system. Therefore, through provision of liquidity injection and capital expansion to the financial sector facing temporary distress amid a crisis situation, it is necessary to keep the cost of maintaining stability in the financial system to a minimum levelby preventing insolvency of financial institutions as well as spread of risks. Major economies such as the U.S., Japan and EU had already set up relevant systems to prevent systemic risks and minimize the cost of insolvency resolution in the wake of the 2008 global financial crisis. On the contrary, t
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Jul 25, 2022

FSC Introduces Financial Support Programs Tailored to the Needs of Small Businesses

The FSC announced its plan to provide KRW41.2 trillion worth of financial support programs tailored to the needs of self-employed business owners and small merchants over two years in order to provide liquidity support, help boost their competitiveness and assist with recovery efforts. Background During the COVID-19 pandemic, the debt service burden of self-employed business owners and small merchants has accumulated as those undergoing difficulties due to a slowdown in contact-based consumption and business restrictions have resorted to more borrowing. The qualitative structure of their loans also deteriorated due to an increase in borrowing from the nonbank sector and growth in the number of borrowers who have multiple debts. The government has thus far provided financial support on an emergency and temporary basis through funding supply with low interest rate loans, maturity extension and payment deferment, etc. However, in the process of returning to normal daily activities, authorities plan to work preemptively and comprehensively to ensure that there are no financing difficulties for self-employed business owners even when the emergency and temporary pandemic era support measures come to an end. In this regard, authorities have prepared comprehensive support packages in the amount of KRW80 trillion that are tailored to the financial needs and business situation of self-employed business owners and small merchants as shown below. a) (For Borrowers with Repayment Capability) KRW41.2 trillion in financing support for liquidity provision and to help boost their business competitiveness (included in todays announcement) b) (For Borrowers Having Difficulties with High Interest Rates) KRW8.5 trillion in refinancing support with low interest rate loan (to be announced in August) c) (For Borrowers without Repayment Capability on Their Own) KRW30 trillion worth New Start Fund to be set up for debt adjustment support through principal payment reduction, etc. (to be annou
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Jul 22, 2022

Government and Financial Sectors to Work for Soft Landing of Business Loan Forbearance

The FSC and FSS along with major banks, financial industry associations and other relevant institutionsdecided to set up a consultative body to work together for a soft landing of the loan maturity extension and payment deferment programfor small merchants and SMEs and held its first meeting on July 22.Through consultative body meetings, authorities will work to prepare a close knit system of support for a soft landing of the maturity extension and payment deferment program in close connection with the governments financial sector measures to help stabilize peoples livelihoods announced on July 14. Background The FSC and financial holding companies held discussions on the implementation of the financial sector measures to help stabilize peoples livelihoods as well as the maturity extension and payment deferment measure at the meeting between the FSC Chairman and CEOs of financial holding firms held on July 21. At the meeting, the financial holding firms stated that financial institutions have been drawing up measures voluntarily in preparation for the termination of the maturity extension and payment deferment program. They indicated that financial institutions are providing one-on-one consulting service and rescheduling of debt payments to help borrowers who are currently on the loan forbearance program to make installment payments (for deferred principal and interest payments) according to their individual debt service capabilities.They explained that each financial institution is preparing its own plan for dealing with borrowers on a case-by-case basis. Nonetheless, in order to prevent potential confusion arising between financial institutions due to divergent situations of borrowers (e.g. debtors with multiple debt accounts), the CEOs of financial holding firms suggested that drawing up a joint guideline that is agreeable by both banks and nonbanks is needed to effectively deal with the areas that individual financial institutions alone cannot adequately address
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Jul 19, 2022

FSC Holds Kick-off Meeting on Financial Regulatory Reforms

The FSC launched a financial regulatory reform committee, composed of 17 private sector participants with expertise in economics, finance, digital, law, and media sectors, to push forward financial regulatory reform initiatives through a private-public cooperation. At its kick-off meetingheld on July 19, the committee appointed Bahk Byung-won, former honorary chairman of the Korea Enterprises Federation (KEF), as committee chairman and discussed directions for financial regulatory reforms. Summary of FSC Chairmans Opening Remarks In his opening remarks, FSC Chairman Kim Joo-hyun emphasized the need for financial regulatory reforms in response to the reshaping of the financial sector and technological changes caused by digital transformation and a blurring of the barriers across sectors (called a Big blur phenomenon). In order for the financial sector to play a key role in economic growth as an independent industry, Chairman Kim called for bold reforms of financial regulations. The financial regulatory reforms, he said, are aimed at creating a new playing field to produce a success story, like a globally-renowned K-pop group BTS, in Koreas finance, in which new players originating from Koreas financial sector would be leading global markets. With financial regulatory reforms, the government will (a) support financial companies, regardless of whether they are online or offline businesses, to grow into global players; (b) create an environment to promote digital innovation for both financial companies and big tech; and (c) allow domestic financial companies to enter businesses, in which global financial companies are allowed to operate. All existing regulations will be reexamined on a clean slate. Chairman Kim stressed the importance of working together principle with various stakeholders from different sectors including industries, academics and media, and asked the financial regulatory reform committee to examine and discuss financial regulatory reform proposals from
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Jul 14, 2022

FSC Unveils New Administration's Financial Sector Measures to Ensure Stability in People's Livelihoods

FSC Chairman Kim Joo-hyun announced the new administrations financial sector measures for ensuring stability in peoples living conditions on July 14. The measures were discussed at the 2nd emergency meeting for stabilizing peoples living conditions held by President Yoon Suk Yeol earlier on the same day. Financial Measures for Ensuring Stability in Peoples Living Conditions (Basic Direction) Strengthen efforts for providing financial supports through refinancing options, debt adjustment and emergency funds to help alleviate burdens on vulnerable groups such as small merchants, households, young adults and lower income earners facing difficulties amid rate hikes. I. Easing Financial Burdens on the Self-employed and Small Merchants Support the self-employed and small merchants recovery efforts by adjusting their debt payment burdens in line with their payment capabilities. a) Make a transition from the current system of financial rescue centered on payment deferments (since April 2020) to a system centered on making fundamental improvements to the financial structure focused on alleviating payment burdens ► (New Start Fund) Provide debt adjustment by purchasing some KRW30 trillion in bad debt (or at-risk debt) - Loan term (maximum 1~3 years), long-term installment payment (maximum 10~20 years), interest rate reduction - Principal reduction (60~90%) provided at a considerable rate to delinquent borrowers with overdue payments of 90 days or more ► (Refinancing Loan) Convert high interest rate loans (with interest rates of 7% or higher) to low interest rate loans (KRW8.7 trillion) ► (Funding for Business Operation) Funding support for business remodeling, reorganization or improvement (KRW42.2 trillion) b) Prepare a close-knit system of support for small merchants to ensure that there are no loopholes after the termination of the loan maturity extension and payment deferment program currently in place until the end of September 2022 ► Maximum loan term of one yea
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Jul 13, 2022

Authorities Introduce Measures to Stabilize Corporate Bond and CP Markets

The FSC announced preemptive market stability measures on July 13 to help stabilize corporate money markets amid rising volatility in the corporate bond and CP markets and financing difficulties exhibited by some businesses due to the impact of recent market rate increases. The Korea Development Bank (KDB) and Korea Credit Guarantee Fund (KODIT)s operation of the corporate bond and CP purchase programswill be extended until March 2023 and the maximum purchase cap will be expanded to KRW6 trillion. Corporate Bond and CP Market Assessment The FSC along with the Financial Supervisory Service, other relevant institutionsand market participants has been closely monitoringthe corporate bond and CP markets amid concerns over increasing volatility in the corporate bond and CP markets due to recent rate hikes. Current Situation in Corporate Bond and CP Markets Due to deteriorating conditions for issuing corporate debt amid expansions in interest rates and spreads, there have been concerns about a slowdown in the issuance of corporate debt and risk for refinancing particularly for low-rated and vulnerable businesses. I. Corporate BondMarket Situation (Issuance) In H1 2022, the amount of corporate bonds (for both non-financial and financial businesses) issued was KRW89.3 trillion, a decline from the same period in the previous year,and the trend for low-rated (non-investment grade) businesses (A-rating or lower) has been continuously declining since March. (Interest Rate and Spread) With acceleration in monetary tightening by major economies and continuing rate hikes by the Bank of Korea, the issuing rateshave increased and spreadshave expanded too. Especially, corporate bond spreads in general have recently gone up higher than the highest point recorded during the COVID-19 pandemic era (June 2020). (Refinancing Risk) Corporate bonds (non-financial businesses) maturing in H2 2022 amount to KRW15.4 trillion, which is the largest since 2017, and the proportion of non-investment
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Jul 12, 2022

Household Loans, June 2022

The outstanding balance of household loansacross all financial sectors rose KRW0.7 trillion in June 2022 with the pace of growth falling from the previous month (up KRW1.7 trillion).The trends in household loan continue to be on a stable path as the statistics for all financial sectors in H1 2022 fell (down KRW0.8 trillion) for the first time since the half-year statistics first became available in 2015.The financial authorities will continue to make efforts for a soft-landing of the household debt issue as there are possibilities of growing burdens on borrowers and risks to financial companies due to interest rate hikes. (Overall) Household loans in June 2022 increased KRW0.7 trillion across all financial sectors. The growth rate (up 2.7%, y-o-y), which fell back lower from a slight increase seen in the previous month, continued to stay on a downward path since the second half of 2021. (By Type) Mortgage loans grew at a faster rate compared with the previous month, but other types of loans dropped considerably to bring down the overall household loan growth level. - (Mortgage Loans) Mortgage-backed loans rose KRW2.8 trillion in June, growing at a faster rate from the previous month (up KRW1.5 trillion) due to brisk lending by banks and the mutual finance sector. - (Other Types of Loans) Other types of loans dropped KRW2.1 trillion in June, edging back lower from a temporary hike in the previous month as credit loans and non-housing collateral lending declined. (By Sector) Household loans in both the banking and non-banking sectors saw a slowdown in the growth level, but the downward trend seen throughout this year in the mutual finance sector has turned upward. -(Banking Sector) Banks saw an increase of KRW0.2 trillion in household loans, declining slightly from the previous month (up KRW0.3 trillion). Mortgage loans from banks rose KRW1.4 trillion,growing at a faster rate compared with the previous month (up KRW0.8 trillion), as jeonse loans (up KRW0.9 trillion) a
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Jul 07, 2022

Revised Rules on Credit Information Business to Enhance Convenience and Efficiency in Data Use

The FSC approved a revision proposal for the supervisory regulation of credit information business at its regular meeting held on July 6. The key revisions and improvements are aimed at facilitating data convergence and utilization between different industries as stated below. a) Allow data utilizing institutions (non-data holders) to make request for data convergence to enable businesses and institutions that are non-data holders to easily converge and utilize data held by other businesses and institutions that are data holders. b) Introduce a data convergence procedure on sample data that can be more efficient and safe for use as it extracts and uses a portion of data from a large data set. c) Make data specializing institutions requirements for self-convergence of data more reasonable to facilitate data convergence and utilization by data specializing institutions. d) Introduce a qualification verification system whereby the Financial Supervisory Service (FSS) will verify the qualification of data specializing institutions every three years to ensure the maintenance of expertise and security quality by these institutions. To make additional designation of data specializing institutions, on Monday, July 11, authorities will take applications for preliminary designation from the institutions that have earlier submitted preliminary applications in February. Overview In order to make finance play a leading role in a data economy through promotion of data convergence and utilization between the financial and other various industries, the FSC introduced a revision proposal for the supervisory regulation of credit information business in January 2022,and on July 6, the FSC approved this revision proposal which will go into effect from the date of announcement on July 7. In addition, to make additional designation of data specializing institutions,the FSC will accept applications for preliminary designation of data specializing institutions on Monday, July 11. As previou
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Jul 06, 2022

Interest Rate Disclosure System to be Improved for Protection of Consumer Rights and Interests

The FSC unveiled a set of measures to make improvements to the interest rate disclosure system in the banking sector on July 6. The measures are aimed at protecting the rights and interests of financial consumers and include the following. a) Making improvements to the disclosure of net interest spread (NIS) comparisons and on the disclosure of lending and deposit rates to make accurate and adequate information about interest rates available to consumers. b) Overhauling the rate calculation system to ensure that rate calculation is conducted in a reasonable and transparent way and bolstering the banking sectors self-inspection and internal control on rate calculation. c) Piloting online deposit products intermediary business, strengthening the requirement to explain personal credit assessment to consumers and having banks to disclose their performance on meeting consumers demand for interest rate reduction in order to promote interest rate competition between banks. Background With the normalization in monetary policy taking place across the globe and the Bank of Koreas base rate increase, rapidly rising market rates have pushed up lending rates and deposit rates in the banking sector. In particular, due to a considerable hike in lending rates to households, banks net interest spread (NIS) for the household sector has expandedand consumers are experiencing added burdens as a result. As there are possibilities of growing financial cost burdens on consumers in times of rate hikes, the authorities plan to seek following measures for improvement to expand interest rate disclosures and ensure rate calculation in a reasonable way. Key Details for Improvement I. Improving Interest Rate Disclosures to Bolster Information Accessibility for Financial Consumers a) Net interest spreads (NIS) of all banks will be disclosed in a comparative format (on the website of Korea Federation of Banks) and the disclosure cycle will be shortened from three months currently to one month. Sin
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Jul 04, 2022

FSC and FSS Decide to Implement Measures to Mitigate Stock Market Volatility

In response to a recent increase in stock market volatility, the financial authorities held a market monitoring meeting on July 1 and decided to take measures to mitigate market volatility. (a) Requirement for securities firms to maintain a certain level of collateral ratio on their credit loans will be exempted for three months starting from July 4, which may be extended if needed. (b) Caps on the amount of daily buy orders for acquisition of treasury stocks by listed companies will be eased for three months starting from July 7, which may be extended if needed. (c) The FSS and KRX will jointly conduct a special inspection on short-selling practices. Financial authorities will continue to monitor financial market conditions, holding a joint market monitoring meeting on a weekly basis, and consider or implement market volatility mitigation measures, if needed, in accordance with contingency plans. Background With the KOSPI falling below 2,300 points during intraday trading on July 1, Koreas stock market has shown continued and increasing volatilityon concerns over rising interest rates, expanding inflation, possibility of a global economic recession, etc. Although increased stock market volatility will be inevitable for a while, given macroeconomic conditions at home and abroad, it is necessary to stay alert about the spread of excessive market anxieties. Measures To Mitigate Stock Market Volatility The FSC and FSS held a joint market monitoring meeting with relevant securities institutionschaired by FSC Vice Chairman Kim So-young to examine financial market conditions after the market closing on July 1, and decided to implement the following measures to mitigate market volatility. (a) For three months from July 4 to September 30, which may be extended if needed, securities firms will be exempted from a requirementto maintain a certain level of collateral ratios on their credit loans in order to ease concerns about a surge in forced liquidation with declining stock
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Jun 29, 2022

One-stop Lost Credit Card Reporting Service Available from Account Info Mobile App from June 29

The FSC announced the availability of the one-stop integrated lost credit card reporting service from a mobile application called Account Info from June 29 through which financial consumers using credit cards from different issuers can simply access the app to submit lost reports at once. Background Along with the Credit Finance Association and the payment card industry, the FSC has been operating a one-stop integrated lost credit card reporting service to protect card users.As of now, the one-stop integrated lost credit card reporting service is available at credit card companies through their mobile apps or websites, and the total number of lost card reports reached some two million until the end of December 2021. To help accommodate such wide usage of the one-stop integrated lost credit card reporting service and to improve service access and convenience for financial consumers, the authorities have been working to expand the availability of one-stop integrated lost credit card reporting service to the Account Info mobile app. Key Details From June 29, the one-stop integrated lost credit card reporting service is available on the Account Info mobile app. Within the Account Info mobile appthat provides one-stop integrated search and management of a users all financial account and card information, a new One-stop Lost Card Report function will be added under the menu My cards at a glance. On the Account Info app, users can (a) check which cards they are currently using, (b) choose the cards they want to report as being lost and (c) submit a lost report. With the reduction in time and process for submitting lost reports, it is expected that this service will improve consumer convenience and help lower the amount of damages resulting from lost or stolen cards. Lost reports for credit, debit or family cards issued under the same name as the person filing the lost report can use this service (corporate cards excluded) and this service can be used from overseas as well.
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Jun 23, 2022

FSC Holds 2nd Financial Risk Taskforce Meeting

FSC Vice Chairman Kim So-young held the 2nd financial risk taskforce meeting on June 23 jointly with the other relevant institutions.The meeting discussed the following three issues(a) expanded operation of the emergency response review system,(b) preparing ten major financial risk response tasks and focusing review on these issues and (c) working on preemptive support measures to prevent default risk of financial companies. In his opening remarks, Vice Chairman Kim stated that volatility has been expanding in global financial markets and there are growing concerns about economic slowdown amid a prolonging war in Ukraine and an acceleration of monetary tightening in the U.S. and other major economies. As such, Vice Chairman Kim emphasized that it is necessary to more closely and comprehensively check market risks with a strong sense of urgency as if a complex crisis situation may surface anytime. In addition, Vice Chairman Kim said that while maintaining a daily financial market monitoring system, the authorities have strengthened the emergency response review system through an expanded operation of the financial risk response taskforce and that the authorities will carry out monitoring focused on ten major response tasks. Vice Chairman Kim said that the government will promptly implement the financial support programs to help with peoples living conditionsthat have been included in this years second supplementary budget.Along this line, in order to identify and alleviate the hardship experienced by vulnerable groups, Vice Chairman Kim said that the authorities will set up and operate a taskforce to help relieve financial difficulties of vulnerable groups and prepare specific support measures in advance. While reviewing the risk factors and the liquidity and soundness conditions across the financial system, Vice Chairman Kim talked about the need for a plan to manage excessive leverage of specialized credit finance companies as their high dependence on the issuance
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Jun 20, 2022

2022 Korea Fintech Week to be Held in September

The FSC announced that the 2022 Korea Fintech Week, a global fintech exhibition, will be held from September 28 to 30 this year in cooperation with relevant institutions. With the availability of both offline and online participation, the Korea Fintech Week will help accelerate innovation in the fintech industry. (Offline) Three days of fintech IR events, investor consultation, job mentoring, fintech-themed seminars will help with investment promotion and employment opportunities. (Online) Exhibition halls, learning programs, experience programs and seminars will be operated online through metaverse. For participation in exhibition halls, idea contest, IR competition and investment consultation, please see detailed information below. Overview of 2022 Korea Fintech Week (Theme) Fintech, Tearing Down Barriers in Finance The 2022 Korea Fintech Week will be operated so as to help expand and replicate the innovation and growth of the fintech industry in close cooperation with relevant institutions. (Program) Offline and online events will be held simultaneously. a) (Offline) The 2022 Korea Fintech Week will provide a variety of venues for fintech firms, investors, relevant institutions and the public to come together through seminars, consultations, exhibitions and other standing programs. - (Opening Ceremony) Sharing outcomes of the fintech policy and presenting policy direction for innovation. - (Seminar) Seminars organized around specific fintech areas such as blockchain, data, etc. - (Investment) Providing opportunities for fintechs to attract investment through fintech IR, investment consultation, etc. - (Exhibition Halls) Introducing fintech services launched by fintech businesses and financial institutions. - (Programs for Participation) Providing an opportunity for prospective entrepreneurs to pitch ideas about fintech business models through idea contest and mentoring and giving fintech jobseekers a chance to have consultation. b) (Online) Various online program
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