Financial Supervisory Service Summons Banks: "Secure Medium- to Long-Term Foreign Currency Funding, Prepare for Middle East Risks"

The Role of Banks Emphasized in the Restructuring of Real Estate PF Projects

Financial Supervisory Service, Yeouido, Seoul. Photo by Younghan Heo younghan@

The Financial Supervisory Service (FSS) convened domestic banks and urged them to proactively prepare for expanding external risks, including geopolitical risks between Iran and Israel, by securing medium- to long-term foreign currency funding.

On the 16th, the FSS held a meeting with Chief Risk Officers (CROs) of domestic banks at the Korea Federation of Banks, stating, "Contrary to initial expectations, the U.S. base interest rate cut has been delayed, and external risks are expanding," and requested, "Please review this year's funding plans and prepare for external risks by securing medium- to long-term foreign currency funding."

The FSS is continuously monitoring the impact of the "three highs" phenomenon?high interest rates, high exchange rates, and high oil prices?on the financial market and corporate sectors, and requested banks to actively play a role in market stabilization and ensuring smooth capital circulation.

Additionally, the FSS emphasized the role of funding supply related to real estate project financing (PF). The FSS plans to prepare improvement measures for business feasibility evaluation criteria to encourage each lending group to restructure PF projects.