[2022 National Audit] Lee Bok-hyun, Financial Supervisory Service Chief, "Will Review Appropriateness of Bank Loan Interest Calculation System"

[Image source=Yonhap News]

[Asia Economy Reporters Song Hwajeong and Song Seungseop] Lee Bokhyun, the Financial Supervisory Service (FSS) Governor, announced that he will inspect whether banks' loan interest calculation systems possess rationality and appropriateness.

At the National Assembly's Political Affairs Committee audit on the 24th, in response to Min Byungdeok, a member of the Democratic Party of Korea, pointing out that banks have been including deposit insurance fees and reserve requirements that they must pay in loan interest, thereby burdening borrowers, Lee said, "We are aware of issues related to banks' loan interest calculation systems," adding, "Together with the Financial Services Commission, we are inspecting whether the calculation system has any problems regarding appropriateness and rationality, and we will strive for improvements."

On the same day, Min Byungdeok of the Democratic Party of Korea stated, "Banks have unfairly imposed deposit insurance fees and reserve requirements, which they are responsible for, onto borrowers by including them in the loan spread," and added, "I believe the costs unfairly imposed on borrowers, which should have been borne by the banks themselves, should be reimbursed."

In response, Governor Lee said, "We are concerned about the fact that banks have borne costs arising from deposits in the form of loan spreads, which should not actually be charged to loans," and added, "There is a consensus that banks are not fulfilling their social responsibilities, so we will ensure that the banking sector can voluntarily make efforts."