Seungbeom Goosung "Total volume control to expand beyond next year... Intensive measures to continue and be implemented gradually"

Announcement of Additional Household Debt Measures in October... The Core is 'Whether the Individual Can Bear It'

Koh Seung-beom, Chairman of the Financial Services Commission

[Asia Economy Reporter Kwangho Lee] Ko Seung-beom, Chairman of the Financial Services Commission, said on the 27th, "We will extend the timeline for managing the total household debt beyond next year and continue to implement strong measures continuously and step-by-step until the effects of the measures become apparent."

On the same day, Chairman Ko held a meeting with economic and financial market experts at the Korea Federation of Banks in Jung-gu, Seoul, stating, "It is necessary to proactively, safely, and surely eliminate the triggers of various latent risk factors."

Attendees at the meeting included Professor Kim Young-ik of Sogang University, economic commentator Lee Jong-woo, economist Oh Seok-dae of SG Securities, Kim Young-il, head of the Research Center at NICE Investors Service, Kim Dong-hwan, director of the Alternative Finance and Economy Research Institute, Shin Dong-jun, head of the KB Securities Research Center, and Shin Yong-sang, director of the Financial Research Institute.

Chairman Ko diagnosed, "It is a situation where excessive household debt and overheating of asset markets such as real estate must be proactively eliminated before they worsen further. At the same time, there is a complex task of ensuring uninterrupted support for vulnerable groups who may face increased difficulties during this process."

He emphasized, "Since the household debt problem we are currently facing has accumulated and expanded over a long period, some discomfort and time are inevitably required to reverse this inertia, but we will push forward proactively and strongly with consistent policy will."

He added, "The most important criterion in loan decisions should be whether the borrower can bear the loan and repay it stably even if circumstances change in the future. The core of the household debt measures to be announced by the government in October will focus on enhancing the effectiveness of such repayment ability assessments."

The government is considering additional household debt management measures, including advancing the schedule for phased implementation of the Debt Service Ratio (DSR) regulations by borrower and strengthening DSR regulations on secondary financial institutions. Measures to tighten margin loans by securities firms are also being discussed. The announcement is expected shortly after the National Assembly audit.