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Dec 19, 2024
- FSC and FSS Announce Measures to Ensure Market Stability and Bolster Support for the Real Economy
- The Financial Services Commission and the Financial Supervisory Service announced on December 19 a set of measures intended to ensure financial market stability and enhance the financial sectors capacity to support domestic businesses and the real economy in preparation for a potential expansion of market volatility caused by ongoing uncertainties at home and abroad. After having a series of market monitoring and industry group meetings with financial companies, the capacity enhancement measures for financial companies soundness, liquidity, and financial conditions have been drawn up well within the scope of international standards, such as the Basel III framework. First, the stress capital buffer requirement for banks that was initially set to be introduced this year will be postponed until the second half of 2025. Authorities will reexamine the exact timeline and method for introducing stress capital buffers in the first half of 2025. Second, with regard to the foreign exchange (FX) positions of banks, the non-hedgeable types of FX positions, such as investments on overseas branches that are not significantly exposed to the risk of short-term volatility in the FX market, will not be counted toward the calculation of their FX risk exposures. Third, when insurance companies make contributions to the stock market stabilization fund through purchase of the fund, the amount being calculated toward the risk exposure of their K-ICS (Korea Insurance Capital Standard) ratios will be reduced from the entire amount to half the amount. Moreover, the following measures have been prepared to lower the burden of financial companies in issuing loans and investing in domestic companies, thereby enhancing financial companies capacity to support domestic businesses and the real economy. Fourth, changes will be made to the 400 percent risk weight currently applied across the board on new technology investment funds, venture funds, and other types of investment association funds estab
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Dec 17, 2024
- Revised Rules on Credit Information Businesses to Lower Entry Barrier
- The Financial Services Commission announced that a partial revision bill for the Credit Information Use and Protection Act has been approved by the government at the cabinet meeting held on December 17. The revision makes the entry barrier more reasonable for business credit rating service providers, improves the quality of business credit evaluation models by making them subject to a periodic review by an external verification committee, and incorporates into the law the current preliminary approval system for credit information businesses, which has been operating as part of a subordinate regulation. First, the revision bill abolishes the current investment requirement for financial companies toward business credit rating service providers. Currently, corporate entities that have secured at least 50 percent of investment from financial companies were allowed to apply for licenses to operate as business credit rating service providers. However, considering the need to promote the entry of more businesses that are equipped with various types of business data into the business credit rating service sector, stock companies established as prescribed under the Commercial Act will be newly authorized to operate as business credit rating service providers. Second, the revision bill will make business credit evaluation models subject to a periodic review by an external verification committee to regularly check their appropriateness and improve quality management. Under the current system, credit evaluation models for individuals and sole proprietors are subject to a periodic review performed by the verification committee operated by Korea Credit Information Services. However, an external review mechanism has been lacking for business credit evaluation models. Thus, this revision bill makes them subject to an external review, which will help to improve the quality management over credit evaluation models. Third, the revision bill brings into the law the current preliminary
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Dec 16, 2024
- Financial Authorities of Korea and Japan Hold 8th Shuttle Meeting
- The Financial Services Commission and the Financial Supervisory Service announced that the 8thKorea-Japan shuttle meeting of financial authorities of Korea and Japan is held on December 16-17 in Tokyo, Japan. Joint Press Release of the Eighth Korea-Japan Shuttle Meeting of Financial Services Commission and Financial Supervisory Service of the Republic of Korea and Financial Services Agency of Japan (Tokyo, Japan, September 16, 2024) 1. The Eighth Japan-Korea Shuttle Meeting was held by the Financial Services Commission (FSC) and the Financial Supervisory Service (FSS) of the Republic of Korea and the Financial Services Agency (FSA) of Japan in Tokyo, Japan, on December 16. 2. At the Shuttle Meeting, Mr. LEE Bokhyun, Governor of the FSS of the Republic of Korea and Mr. ITO Hideki, Commissioner of the FSA of Japan exchanged views on the global economic and financial situation and its impact on Korean and Japanese financial institutions. They also exchanged views on the recent developments in their respective markets. 3. Commissioner Ito welcomed Governor Lees visit to Japan, recognizing the importance of maintaining timely and close communication between the financial authorities of Japan and Korea for the stability of the financial market in the East Asian region. 4. Governor Lee reaffirmed the importance of both countries cooperation and coordination in enhancing financial stability in the region, introducing the Korean authorities measures to stabilize the financial markets in the wake of the recent market fluctuations, as well as their next steps to address them going forward. 5. In view of the coming 60th anniversary of the normalization of relations between the Republic of Korea and Japan in 2025, they reaffirmed that the authorities of both countries will continue to work together to respond effectively to common opportunities and challenges in the financial sector, anticipating that this shuttle meeting will continue to provide an important platform for this e
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Dec 16, 2024
- FSC Chairman Holds Meeting and Calls for Continuous Efforts at Market Stability and Policy Implementation
- Chairman Kim Byoung Hwan of the Financial Services Commission convened an extended senior officials meeting on December 16 to discuss current situation and response strategies. The following is a summary of Chairman Kims remarks. A Summary of Chairmans Remarks In response to current political situation, the governments top priority has been to leave no vacuum in the administration of state affairs. In this regard, as public servants overseeing the countrys financial policies, financial officials should continue to carry out their responsibilities with a sense of duty. In order to boost confidence in the market and ensure external creditworthiness, it is necessary to have continuous efforts to ensure market stability and implement policies in a consistent way. Although market conditions have recently become less volatile, it is still necessary to stay vigilant and maintain a 24-hour market monitoring system, while continuing to closely communicate with financial companies and investors at home and abroad. In particular, officials are asked to quickly review suggestions raised from the financial industry for ensuring market stability, such as the potential of postponing the implementation of stress capital buffers, and promptly announce what can be done as soon as possible starting from this week. To help small merchants and self-employed business owners with their financial difficulties, it is necessary to introduce the measures intended to reduce the burden of card processing fees as they have been initially planned for this week. In addition, officials are asked to closely coordinate with the banking sector to make sure that we can announce within this month new support measures, such as a debt workout program for non-delinquent business owners and those undergoing business closure. To ensure that businesses face no difficulties in raising funds, officials are asked to closely check the financing situation of businesses by their size and gather opinions from relate
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Dec 12, 2024
- Authorities Introduce Administrative Guidelines on Green Finance for Application on K-taxonomy
- The Financial Services Commission, the Ministry of Environment, and the Financial Supervisory Service announced on December 12 the establishment of administrative guidelines on green finance for application on the green economic activities specified by K-taxonomy. In 2021, the Ministry of Environment established K-taxonomy to provide clear standards on eco-friendly and green economic activities, and in 2022, the Financial Services Commission and the environment ministry introduced the guidelines on green bonds to facilitate the application of K-taxonomy in the financial sector. In this regard, the administrative guidelines on green finance being introduced today provide specific criteria for determining the appropriateness of financing green economic activities for financial companies, thereby creating conditions to promote green financing. In preparing for the administrative guidelines, financial authorities examined overseas cases, sought consultations from experts, collected opinions from taskforce meetings on climate finance, and conducted pilot tests. The administrative guidelines contain specific criteria for determining green economic activities when financial companies provide green finance to businesses, and address issues regarding the prevention of greenwashing and internal control of financial companies. Key details of the administrative guidelines are as follows. First, a clear definition on green finance has been established. Under the administrative guidelines, green finance refers to the financing of an economic activity that meets the standards specified by K-taxonomy with appropriate internal control procedures. This clarification will help to resolve uncertainties regarding greenwashing for financial companies and encourage them to more actively provide green finance. Second, internal control standards have been established for financial companies regarding their handling of green finance related works, detailing who should be in charge of determi
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Dec 11, 2024
- Household Loans, November 2024
- In November 2024, the outstanding balance of household loans across all financial sectors rose KRW5.1 trillion (preliminary), growing at a slower pace compared with the previous month (up KRW6.5 trillion). (By Type) Home-backed mortgage loans grew KRW4.1 trillion across all financial sectors, rising at a slower pace compared with the previous month (up KRW5.5 trillion). Mortgage loans in the banking sector continued to grow at a slow pace (up KRW3.6 trillion up KRW1.5 trillion). Other types of loans increased KRW1.1 trillion overall, keeping the same level of growth from a month ago. Banks saw a small increase in unsecured loans (up KRW0.3 trillion up KRW0.4 trillion), while nonbanks saw a slight decline (up KRW0.8 trillion up KRW0.6 trillion). (By Sector) The pace of household loan growth slowed down in the banking sector while expanding in the nonbanking sector month-on-month. In November, banks saw an increase of KRW1.9 trillion in household loans, a drop from the increase of KRW3.8 trillion a month ago. The growth of policy-based loans expanded (up KRW2.0 trillion up KRW2.3 trillion) due to continuing demand for government-backed mortgage loans, but the issuance of banks own mortgage loans shifted down (up KRW1.5 trillion down KRW0.8 trillion). Other types of loans including credit loans in the banking sector rose at a slightly faster pace (up KRW0.3 trillion up KRW0.4 trillion) compared with the previous month. Nonbanks saw an increase of KRW3.2 trillion in household loans, growing at a faster pace from the previous month (up KRW2.7 trillion). Mortgage loans from nonbanks expanded at a faster pace (up KRW1.9 trillion up KRW2.6 trillion), but the pace of grow decelerated for other types of loans (up KRW0.8 trillion up KRW0.6 trillion). Mutual finance businesses (up KRW1.6 trillion), insurance companies (up KRW0.6 trillion), specialized credit finance businesses (up KRW0.6 trillion), and savings banks (up KRW0.4 trillion) all saw increases in household loans. (As
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Dec 10, 2024
- FSC Chairman Holds Meeting with Foreign Financial Companies
- Chairman Kim Byoung Hwan of the Financial Services Commission met with officials from foreign financial companies on December 10 to have talks on recent political and economic situations in Korea and to assure that the Korean government has sufficient capacity to ensure stability in financial markets. At the meeting, Chairman Kim emphasized that despite increased political uncertainties, the countrys economic issues are being managed in a consistent and stable manner with the Deputy Prime Minister leading the governments economic team. Chairman Kim also said that the government has maintained a high level of preparedness for the implementation of market stabilization measures, and that key policy agendas, such as the soft-landing of the real estate project finance market, Corporate Value-up Program, and capital market reform initiatives, will continue to be pursued according to the previously set schedule. In this regard, Chairman Kim said that the government will make efforts to more closely communicate with foreign financial companies to provide adequate explanations about the ongoing situations and the governments plans. The officials from foreign financial companies attending todays meeting expressed a view that the current political situation will not significantly affect the fundamentals of the Korean economy or have negative impact on the economy on a continuing basis. They showed expectations that as long as the current political uncertainty is resolved quickly, financial markets will also return to stability in no time. However, to help ease short-term volatility in the stock market, participants also raised a view that it is necessary for institutional investors, such as pension funds, to play a more active role in the market. * Please refer to the attached PDF for details.
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Dec 10, 2024
- Plan for Promoting the Benchmark Rate Reform in 2025
- On December 10, the Financial Services Commission and the Bank of Korea held the 5th Benchmark Rate and Short-Term Financial Market Consultation with related organizations, such as the Financial Supervisory Service, the Korea Securities Depository, and the Korea Exchange, as well as academics and market experts, to discuss the Plan for Promoting Benchmark Rate Reform in 2025. Progress of Benchmark Rate Reform in 2024 The benchmark rate is an interest rate that is used to determine the value of money or financial instruments to be paid or exchanged as a result of a financial transaction. It is used to determine the profit or loss of financial transactions, evaluate investment performance, and generally represent the costof short-term financing for financial institution. In major countries, the global benchmark rate reform process, triggered by the LIBOR manipulation case in June 2012, firmly established the actual transaction-based risk-free rate (RFR) as the benchmark rate for financial transactions focusing on derivatives transactions. In 2020, Korea enacted the Act on the Management of Financial benchmarks in accordance with the recommendationsof international organizations such as the Financial Stability Board, and started calculating the Korea Overnight Financing Repo Rate (KOFR) as a critical benchmark rate in 2021. However, the efforts of the KOFR activation went slowly due to the need to prioritize financial market stability during the global liquidity reduction process that began in 2022. In 2024, the government and the Bank of Korea began discussions on revitalizing the KOFR based on stable market conditions and formed a joint public-private working group while strengthening communication with market participants. In August 2024, the government and the Bank of Korea announced the principle of transitioning to a KOFR-centered benchmark rate system. Since then, the working group has been discussing the strategy for activating KOFR and plans to implement the s
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Dec 09, 2024
- FSC Holds Market Monitoring Meeting (Dec. 9)
- Chairman Kim Byoung Hwan of the Financial Services Commission presided over a market monitoring meeting on December 9 with officials from the Financial Supervisory Service, five major financial holding companies, policy financial institutions, and related organizations and industry associations to check market situations and discuss response measures. The following is a summary of Chairman Kims opening remarks. A Summary of Chairmans Remarks At the Ministerial Meeting on Economic Affairs held yesterday, the government made an announcement that the economic team will spare no effort in ensuring a stable management of the economy despite looming uncertainties caused by recent political situations. In this regard, the FSC and the FSS will continue to do our parts and carry out our responsibilities in unwavering ways to ensure the maintenance of stability in our financial system and the external credibility in the financial sector. While continuing to maintain a real-time market monitoring system around the clock, authorities are prepared to promptly implement market stabilization measures when it becomes necessary, including a KRW10 trillion stock market stabilization fund, a KRW40 trillion bond market stabilization fund, the corporate bond and commercial paper (CP) purchase program, and the supply of foreign currency liquidity through the Korea Securities Finance Corporation. Meanwhile, authorities will seek to consistently pursue financial policy agendas according to the previously planned schedule. While ensuring a seamless implementation of the previously introduced measures, such as the Corporate Value-up Program, establishing a system designed to prevent illegal short sale activities, and granting a license to a new internet-only bank, authorities will keep pursuing the agendas that were slated for December, such as the measures to ease the financial burden of small merchants and self-employed business owners and the indemnity health insurance reform measures. To
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Dec 04, 2024
- FSC Holds Market Monitoring Meeting (Dec. 4)
- Chairman Kim Byoung Hwan of the Financial Services Commission convened a meeting on December 4 with officials from related authorities, financial institutions, and industry groups to check market situations and discuss response measures. The following is a summary of Chairman Kims opening remarks. A Summary of Chairmans Remarks Currently, the situation surrounding the foreign exchange market and overseas-listed stocks of Korean companies appear to be stabilizing. However, as there are concerns about a potential rise in volatility, financial authorities will utilize all available measures to prevent the spread of market anxiety and ensure a seamless and stable operation of financial markets in close coordination with policy financial institutions, related organizations, and industry groups. At the Emergency Meeting on Macroeconomic and Financial Issues (F4 Meeting) held earlier this morning, authorities decided to ensure the supply of unlimited liquidity support until the conditions return to normal in the financial markets. The measures include stock market stabilization fund in the amount of KRW10 trillion, bond market stabilization fund in the amount of KRW40 trillion, and the corporate bond and commercial paper (CP) purchase program all aimed ensuring market stability. At the same time, authorities will closely monitor financial companies foreign currency liquidity conditions to ensure their soundness, while supplying foreign currency liquidity through the Korea Securities Finance Corporation to prevent the risk of margin call emanating from a potential weakening of the Korean won. In responding to market situations, each organization is asked to strictly follow its own contingency plan. In this regard, policy financial institutions are asked to mobilize all available resources to ensure an active and flexible supply of funds to make sure that vulnerable groups, small merchants, and businesses face no challenges in meeting their financing needs. The stock market
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Dec 03, 2024
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Nov 29, 2024
- FSC Holds Meeting and Discusses Plans for Operating Temporarily Eased Financial Regulations
- The Financial Services Commission held a meeting with related authorities and industry organizations on November 29 to discuss plans for operating temporarily eased regulations in financial sectors. At todays meeting, authorities discussed plans for the operation of the eased regulatory measures in the banking, financial investment, specialized credit finance, and savings banks sectors that are currently set to expire at the end of December this year. Given that an improvement in money market conditions is expected in the future and that all financial sectors liquidity ratios as of September 2024 stood above the normal regulatory levels, officials at todays meeting shared the same view on the need to gradually normalize the eased regulatory measures on financial companies liquidity requirements, which have been introduced at the time of market instability. In this regard, the banking sectors LCR (liquidity coverage ratio) requirement currently standing at 97.5 percent will be rolled back to 100 percent from January 1, 2025, and for financial investment businesses, the cap on the amount of bonds (issued by specialized credit finance businesses) that can be included when hedging risks associated with derivatives-linked securities (DLS) will also be downsized to 8 percent as scheduled from January 1, 2025. Meanwhile, the loan-to-deposit ratio of savings banks and the KRW-based currency liquidity ratio of specialized credit finance businesses will be gradually rolled back in stages. From January to June 2025, savings banks will be subject to a loan-to-deposit ratio of 105 percent (down 5 percentage points from 110 percent currently), and specialized credit finance businesses will be subject to a KRW-based currency liquidity ratio of 95 percent (up 5 percentage points from 90 percent currently) during the same period. In the second quarter of 2025, authorities will decide on whether to extend the period or completely roll back the eased regulatory measures after consider
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Nov 28, 2024
- Licensing Criteria for New Internet-only Bank to Focus on Sustainability Based on Innovativeness and Inclusiveness
- The Financial Services Commission adopted the licensing criteria and procedure for authorizing a new internet-only bank at the 20th regular meeting of the FSC held on November 27, 2024. Previously on July 5, 2023, the government introduced a plan to grant new licenses to more nationwide commercial banks, regional banks, and internet-only banks to promote competition in the banking industry. With regard to the criteria and procedure for licensing new internet-only banks, the government said that it plans to consider the performance and stability of the operation of the three existing internet-only banks along with the statutory requirements prescribed under the current law. Since then, the government carried out an examination on the performance and effects of introducing internet-only banks and looked into areas where improvements are necessary. Meanwhile, a separate study was conducted on the competitiveness of financial companies SME and personal credit loan business operations to assess the areas where enhanced competition and increased supply of funds are needed. Based on the findings from these studies, the FSC and the FSS (Financial Supervisory Service) adopted the licensing criteria and procedure for authorizing a new internet-only bank as follows. The new licensing criteria will maintain the previously adopted licensing standards for internet-only banks, which include (a) the licensing criteria specified in the Banking Act and (b) the innovativeness and inclusiveness of applicants business plan. However, the key direction of application review and evaluation criteria will take into account the findings from the aforementioned studies. In this regard, the evaluation of application will focus on (a) the stability in raising capital, along with (b) the innovativeness and (c) inclusiveness, and (d) the feasibility of business plan. First, regarding the stability in raising capital, the evaluation committee will thoroughly look into whether the applicant has a su
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Nov 21, 2024
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Nov 19, 2024
- Rule Changes on Corporate Mergers and Acquisitions Approved by the Government
- The Financial Services Commission announced that a revision bill for the Enforcement Decree of the Financial Investment Services and Capital Markets Act (FSCMA) intended to upgrade rules on corporate mergers and acquisitions (MAs) was approved by the government at the cabinet meeting held on November 19. The revised Enforcement Decree addresses the following(a) improving rules on determining merger prices when MAs take place between nonaffiliated business entities, (b) strengthening disclosure duties, and (c) revamping rules on the external evaluation process. First, the revised Enforcement Decree will improve rules on calculating and determining merger prices when MAs take place between nonaffiliated business entities. Previously, the Enforcement Decree had a provision directly regulating specific methods for calculating merger prices for MAs taking place between both affiliated companies and nonaffiliated companies. This rule may have acted as a barrier for companies when seeking corporate restructuring based on free negotiations. Therefore, the revised Enforcement Decree will remove the calculation method for merger prices for MAs taking place between nonaffiliated business entities, which will also help to enhance regulatory consistency with global standards. Second, the revised Enforcement Decree will bring about improvements to the external evaluation system by obligating companies to go through an external evaluation process when MAs take place between nonaffiliated business entities. For MAs between affiliated entities, companies will need to obtain consent from auditors (or audit committees) when selecting an external evaluation agency. In addition, the revised rules establish a code of conduct on quality management for external evaluation agencies to guarantee the maintenance of autonomy, objectivity, and fairness in performing functions related to MAs and address issues related to conflicts of interest. The revised Enforcement Decree will also require eva
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Nov 13, 2024
- FSC Holds Meeting to Review Market Conditions and Extends Operation of Market Stabilization Programs
- Vice Chairman Kim Soyoung of the Financial Services Commission held a meeting on November 13 with related organizations and market experts to go over economic and financial market conditions at home and abroad in the wake of U.S. presidential elections and Feds monetary policy pivot and discuss policy responses to ensure market stability. Market Stabilization Programs At the meeting, Vice Chairman Kim said that it is necessary to maintain backstops in order to be prepared for the potential of rising uncertainty and volatility in the market. Therefore, Vice Chairman Kim said that the market stabilization programs currently in place will continue to be operated at the same level in 2025. In order to ensure stability in financial markets, Vice Chairman Kim said that it is necessary to take into account comprehensive factors, such as the political and economic uncertainties in major economies including the U.S., ongoing geopolitical risks in the Middle East, deepening global competition for Koreas strategic industries and the potential of downward adjustment in GDP growth, and the restructuring and resolution of problematic real estate development projects. As it is possible that financial markets may experience a temporary rise in volatility affected by various external factors, Vice Chairman Kim said that the government and related organizations will continue to stay alert and make consistent efforts to ensure market stability. To this end, the government and policy financial institutions (Korea Development Bank, Industrial Bank of Korea, and Korea Credit Guarantee Fund) plan to continue to make available liquidity support programs worth up to KRW37.6 trillion to ensure stability in the corporate bond and money markets in 2025, which include the following(a) bond market stabilization fund of up to KRW20 trillion, (b) corporate bond and commercial paper (CP) purchase program of up to KRW10 trillion, (c) primary collateralized bond obligation (P-CBO) support program of
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Nov 13, 2024
- Korea-Poland MOU on Banking Supervision Signed to Promote Overseas Expansion of Korean Financial Services
- Chairman Kim Byoung Hwan of the Financial Services Commission met with Jacek Jastrzebski, Chair of the Board of the Polish Financial Supervision Authority (KNF) at his office in Seoul Government Complex on November 13 where the two sides signed a memorandum of understanding (MOU) on banking supervision. This marks the first such visit to Korea by Chair of the Board of the Polish Financial Supervision Authority (KNF). Since the establishment of diplomatic ties in 1989, Korean companies have continued to expand their business presence in Poland. As of 2023, the number of Korean companies operating in Poland reached about 370 with the volume of investment standing at about KRW6 billion in cumulative terms and that of annual trade reaching about KRW9 billion. However, there still exist no Korean financial companies operating in Poland. As the financing needs and demand from Korean companies have been growing in local market, there has been growing interest among Korean financial companies to expand their presence in the Polish market. Following the previously held summit meetings between Korea and Poland (in July 2023 and October 2024), bilateral cooperation has been strengthened in the areas of defense industry, nuclear power, infrastructure, and advanced technologies, and it is highly anticipated that mutual exchange in economic and financial sectors will also accelerate. Against this backdrop, the visit by the Polish Financial Supervision Authority (KNF) along with the Polish banking sector delegation lays a foundation to boost bilateral exchange of banking businesses. Korea-Poland MOU on banking supervision At the meeting with Chair Jacek Jastrzebski of the Polish Financial Supervision Authority (KNF), FSC Chairman Kim Byoung Hwan showed strong commitment to boost cooperation going forward and talked about the significance of the progress made this year in enhancing financial cooperation between the two countries with the shuttle meetings held between chief financia
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Nov 11, 2024
- Household Loans, October 2024
- In October 2024, the outstanding balance of household loans across all financial sectors rose KRW6.6 trillion (preliminary), growing at a faster pace compared with the previous month (up KRW5.3 trillion). (By Type) Home-backed mortgage loans rose KRW5.5 trillion across all financial sectors, increasing at a slower pace compared with the previous month (up KRW6.8 trillion). Mortgage loans in the banking sector continued to rise at a slower pace (up KRW6.1 trillion up KRW3.6 trillion). Other types of loans increased KRW1.1 trillion overall, edging back up in both the banking (down KRW0.5 trillion up KRW0.3 trillion) and nonbanking (down KRW0.1 trillion up KRW0.8 trillion) sectors. (By Sector) The pace of household loan growth compared with the previous month decelerated in the banking sector while shifting back up in the nonbanking sector. In October, banks saw an increase of KRW3.9 trillion in household loans, a slowdown from the increase of KRW5.6 trillion a month ago. The growth of policy-based loans stayed at a similar level (up KRW2.1 trillion), but banks own mortgage loan issuance grew at a slower pace (up KRW4.0 trillion up KRW1.5 trillion) due to the self-regulatory move to tighten household loan issuance in the banking sector. Other types of loans including credit loans turned back up from a month ago (down KRW0.5 trillion up KRW0.3 trillion) due to the effects of demand for IPO subscriptions. The nonbanking sector saw an increase of KRW2.7 trillion in household loans, which expanded at a faster pace compared with the previous month (down KRW0.3 trillion). Mortgage loans in the nonbanking sector went up KRW1.9 trillion from the rise of KRW0.7 trillion a month ago led by group lending for new apartment subscriptions. Other types of loans increased KRW0.8 trillion from the decline of KRW1.0 trillion a month ago led by credit card and insurance policy-based loans. Mutual finance businesses (up KRW0.9 trillion), specialized credit finance businesses (up KRW0.9 tr
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Nov 05, 2024
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Oct 31, 2024
- FSC Vice Chairman Visits Germany and Lithuania to Support Overseas Expansion of Korean Financial Services
- Vice Chairman Kim Soyoung of the Financial Services Commission visited Frankfurt, Germany and Vilnius, Lithuania from October 28 to November 1 in order to seek stronger financial cooperation with the European countries following bilateral summit meetings held in 2023. Meeting with ECB Supervisory Board Member On October 29, Vice Chairman Kim met with the European Central Bank (ECB)s supervisory board member Patrick Montagner to elicit consensus on the scope of cooperation prescribed in the draft memorandum of understanding (MOU) on banking supervision, which is expected to be signed by the end of this year. The agreed upon draft MOU contains provisions detailing cooperation and information exchange on banking supervision between the FSC and the FSS (Financial Supervisory Service) of Korea and the ECB regarding financial companies license application, appointment of directors, sanctions, and recovery and resolution plans (RRPs) upon request by the counterparty. This MOU is expected to help improve the crisis response capacity of both parties and enhance banking supervision through RRPs. After the fine-tuning of the draft MOU, Vice Chairman Kim and Mr. Montagner held talks on policy issues regarding sustainable finance and the introduction of artificial intelligence (AI) in the financial industry. On sustainable finance, both sides had opportunities to share their policy response and how they are dealing with the issue, for instance through climate risk stress test, etc. With regard to the advent of AI technology and its convergence with financial services, both sides agreed on the importance of international cooperation to build a regulatory framework that can help to maximize opportunities while minimizing risks presented by advance technologies. Meeting with Korean financial companies operating in Germany Vice Chairman Kim also held a meeting with a group of Korean financial companies doing business in Germany and had talks on local industry trend, operating condit
