Financial Services Commission Calls for Close Monitoring of Household Loans Amid Upward Trend in Mortgage Lending

The Financial Services Commission (FSC) urged the financial sector today (the 9th) to continue closely monitoring household loans, noting that the upward trend in mortgage lending could persist due to seasonal capital demands such as the upcoming autumn moving season and the separate management of group loans under the August 13 measures.

Shin Jin-chang, Secretary General of the FSC, made the remarks while presiding over a joint household debt inspection meeting with related agencies today.

Attendees at today's meeting included relevant agencies such as the Ministry of Economy and Finance, the Ministry of Land, Infrastructure and Transport, the Bank of Korea, and the Financial Supervisory Service, alongside the Korea Federation of Banks, secondary financial sector associations, and the five major commercial banks.

Regarding follow-up measures to the August 13 real estate policy, Secretary General Shin urged, "Please ensure thorough preparations—such as upgrading computer systems, staff training, and customer guidance—to prevent inconvenience for customers at frontline counters, and pay special attention to the operation of financial companies' credit evaluation committees for exceptions such as first-time homebuyers."

He also emphasized, "In line with the objective of adjusting aggregate targets under the August 13 measures, policy-supported funds necessary for promoting housing supply, stabilizing housing for young people, and resolving liquidity bottlenecks for genuine homebuyers should be supplied in a timely and seamless manner. At the same time, all financial sectors should shoulder a heavy sense of responsibility and continue efforts to fulfill aggregate management targets for each financial company."

In addition, he stated, "As borrowers face heavier repayment burdens due to the Bank of Korea's base rate hikes and rising market interest rates, meticulous care from financial companies is required to prevent harm to ordinary citizens and vulnerable groups."

He further announced, "We will continue our efforts to improve the qualitative structure of household debt by checking the financial sector's handling of fixed-rate mortgage loans and encouraging the banking sector to launch long-term fixed-rate mortgage loans."

According to the FSC, household loans across the entire financial sector increased by 2.6 trillion won in August, showing a smaller increase compared to the previous month (+6.4 trillion won).

The growth in mortgage loans expanded (+3.6 trillion won to +4.3 trillion won), while other loans shifted to a downward trend (+2.8 trillion won to -1.7 trillion won).

(File Photo: Yonhap News)
※ Please note: This article was translated by AI and may contain errors.