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- FSC Chairman holds talks with insurers on specific directions for development of insurance industryAug 28, 2024
- Chairman Kim Byoung Hwan of the Financial Services Commission held talks with heads of insurance companies and relevant insurance associations on August 28 and shared a variety of views on ways to restore public trust in the insurance industry and how the insurance sector can better serve the national economy. At the meeting, Chairman Kim said that the insurance sector played an important role as the source of long-term funds in supporting the real economy. To ensure sustainable growth, however, Chairman Kim called for more active role of the insurance industry as investors with long-term investment horizon, while stably managing their assets. To this end, Chairman Kim outlined four directions for the insurance industry going forward: (a) seeking ways to provide better and more convenient services for customers, (b) strengthening risk management over a long-term period, (c) innovating sales channels with the emergence of new contactless, digital technologies, and (d) providing total solutions in response to future challenges including demographic, technological, and climate changes.
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- Safe suspension of personal credit transactions introduced for consumers in anti-vishing effortAug 23, 2024
- Chairman Kim Byoung Hwan of the Financial Services Commission held a meeting on the safe suspension of personal credit transactions program being introduced from today with officials from related organizations and financial industry groups on August 23. A total of 4,012 financial companies including banks, financial investment businesses, insurance companies, specialized credit finance companies, and mutual finance businesses will offer safe suspension of personal credit transactions to their customers starting from today with aims to prevent vishing scams. Under the program, consumers can visit on-site branches of financial companies and apply for the blocking of new credit transactions from taking place under their names. Priortothe meeting, FSC Chairman Kim took part in service demonstration and had pep talks with tellers at a bank branch. At the meeting, Chairman Kim said that the newly introduced service will help to protect consumers' daily financial activities. To make the service more accessible and convenient in the future, Chairman Kim said that the authorities will work to open up online application channel and permit submission of application by delegated persons.
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- Authorities hold meeting on household debt managementAug 21, 2024
- The Financial Services Commission held a meeting on household debt management with related authorities and industry groups on August 21, chaired by FSC Secretary General Kwon Dae-young. The outstanding balance of household loans has been rising recently led by mortgage loans from banks and policy loans for housing. At the meeting, authorities discussed the following measures to effectively control the pace of household debt growth in the second half of 2024. First, from September 1, the second phase stressed debt service ratio (DSR) rule will take effect. A stress rate of 0.75%p will be additionally applied onmortgage loans and credit loans from banks and mortgage loans fromnonbanks. However, mortgage loans issued by banks for houses in the Seoul metropolitan area will be subjected to an increased stress rate of 1.20%p. Second, for household loans issued from September 1, banks will be required to calculate DSR on all types of household loans for their owninternal management purposes. This will help the banking sector to more closely monitor and examine relevant data on DSR. Third, in the future, authorities will consider implementing additional policy measures, such as expanding theapplication of DSR on other types of loans and increasing mortgage loans' risk weight for banks, after looking at household debt growth andhousing market conditions.
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- FSC Chairman meets with bank CEOs and discusses ways to ensure financial stability and promote sustainable growthAug 20, 2024
- Chairman Kim Byoung Hwan of the Financial Services Commission met with the heads of 19 banks and held talks on the importance of managing risks to ensure financial stability and seeking innovative ways to promote sustainable growth on August 20. Starting with todays meeting with the banking sector, Chairman Kim will meet with each financial sector to have discussions and exchange views on the four major risks facing the Korean economy, such as household debt, small business debt, real estate project finance debt, and the soundness of the nonbanking sector. In his opening remarks, Chairman Kim talked about the need to (a) preemptively manage the pace of household debt growth through concerted efforts of the banking sector and the government, (b) more systematically manage lending to small businesses based on their repayment capabilities, (c) pursue regulatory reforms to bring about change and promote innovation in banks operating practices, which have traditionally relied on interest rate spreads and domestic operations, and (d) continue to work on strengthening internal control mechanisms through the introduction of a responsibilities mapping system from January next year. In particular, with regard to the measures to control the pace of household debt growth, Chairman Kim stressed the need for banks to establish their own household debt management systems in a self-regulating manner based on the repayment capability (debt service ratio) of borrowers.
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