▲ Financial Services Commission Chairman Lee Eok-won speaks at a Cabinet meeting presided over by President Lee Jae-myung at the presidential office on the 21st.
Financial Services Commission (FSC) Chairman Lee Eok-won stated today (the 29th) that he "will continue efforts to protect vulnerable and real-demand borrowers under the consistent household debt management stance of 'disconnecting the real estate market from finance.'"
Chairman Lee made the remarks during a business report to the National Assembly's National Policy Committee.
According to the FSC's preliminary report submitted to the National Assembly committee, the household debt-to-GDP ratio has gradually declined from 98.7% in 2021 to 85.3% in the first quarter of this year.
Chairman Lee diagnosed that "with the growth of mortgage loans slowing down following the June 27 measures, the impact of household debt on the real estate market has also become more limited compared to the past."
He explained that although household loans surged in May and June, this was due to an increase in other loans centered on credit-line loans such as overdraft facilities.
However, the FSC judged that the level of household debt remains high, with destabilizing factors such as increasing market liquidity and inflation.
Nevertheless, in response to criticisms that this year's strict 1.5% total household debt management regulation has even blocked housing-related loans for vulnerable and real-demand borrowers, supplementary measures are currently under review.
The Financial Supervisory Service (FSS) also stated in its preliminary business report submitted to the National Assembly that "considering the potential household loan cliff in the second half of the year, loan shortages, and damage to the housing ladder for the younger generation, we plan to consult with the FSC on appropriate levels of household debt management."
Regarding single-stock leveraged exchange-traded funds (ETFs), he said, "We will promptly push for supplementary measures for swift market stabilization and consider additional measures while monitoring market conditions."
The FSC will raise the basic deposit requirement to 31 million won starting on the 31st.
During August, the FSC plans to increase the responsibility of securities firms and asset managers in managing tracking errors while also enhancing investor risk guidance and pre-education.
The trading unit size will also be increased from 1 share to 20 shares.
During a meeting with the financial investment industry the previous day, Chairman Lee also mentioned a plan to limit individual investments in single-stock leveraged funds to within 20% of their total investment funds if the market does not calm down.
The concentration of individual investors is clear.
Data showed that individual investors accumulated a net purchase of 14.1 trillion won up to the 21st of this month, accounting for about 87% of the total net purchases combined by individuals, foreigners, and others.
Foreigners accounted for a mere 1.5 trillion won level.
The estimated rebalancing amount was calculated at 1.4 trillion won per day, equivalent to 5.7% of the daily average trading value of spot equities.
Regarding Homeplus's rehabilitation procedures, the agency plans to continue extending the maturity of bank loans, deferring repayments, and providing new funds for partner companies to minimize the impact on the livelihood economy.
As of the 17th, loan maturity extensions and repayment deferrals totaled 7,752 cases (5.2 trillion won), while new funding support reached 100 cases (19.1 billion won).
Support for workers' living cost loans by the Ministry of Employment and Labor totaled 8,934 cases (41 billion won).
Taking the Homeplus situation as an opportunity, the FSC also decided to support parliamentary discussions on amending the Capital Markets Act related to improving the private equity fund (PEF) system.
Chairman Lee emphasized that "illegal activities uncovered through inspections and audits will be dealt with strictly."
He also stated that as early as this month, the agency plans to announce governance improvement measures containing contents such as fundamentally blocking 'entrenchment by boards of directors' at financial companies and improving the chief executive officer (CEO) consecutive term system.
(Photo: Yonhap News)
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