Remarks at the Executive Meeting on the 13th
Recently, as housing prices have risen mainly in apartments in the Seoul metropolitan area, household loans have also shown a rapid increase. In this context, Lee Bok-hyun, Governor of the Financial Supervisory Service, announced on the 13th that supervisory capabilities will be focused on managing household loans and ensuring the smooth landing of real estate project financing (PF).
At the executive meeting held that day, Governor Lee ordered, “To support the government's firm commitment to stabilizing the housing market, concentrate supervisory capabilities on managing household loans and ensuring the smooth landing of real estate PF in the second half of the year.”
He emphasized the need to carry out the calculation of the second-stage stress total debt service ratio (DSR) and management-purpose DSR without any setbacks, while also promoting measures to strengthen macroprudential regulations in cooperation with related ministries. He requested strict measures against illicit loans through on-site inspections of DSR screening practices and the adequacy of household loan risk management during the household loan handling process in the banking sector, as well as joint investigations with relevant government agencies.
Lee Bok-hyun, Governor of the Financial Supervisory Service, is attending and speaking at the Securities Company CEO Meeting held on the 3rd at the Korea Financial Investment Association in Yeouido, Seoul. At the meeting, solutions for real estate PF and major issues in the securities industry were discussed. Photo by Jo Yong-jun jun21@
Governor Lee stated, “The real estate development projects must be normalized through the clearance of distressed PF sites via auctions and sales, which will also activate housing supply.” He stressed, “Strengthen inspections to ensure that the plans for clearing and restructuring distressed projects are implemented swiftly, and conduct the second round of feasibility evaluations scheduled for September strictly.”
Regarding the exercise of voting rights by asset management companies, he mentioned the importance of institutional investors’ adherence to the stewardship code. Governor Lee said, “Continuously and thoroughly monitor the status of fund voting rights exercised in cases of shareholder rights violations, and promote the disclosure of names in cases of inadequacy.” He added, “Devise improvement measures to ensure that external factors do not hinder the independent exercise of voting rights by funds and that voting rights are exercised effectively.” Furthermore, he emphasized that the appropriateness of voting rights exercised by asset management companies entrusted with voting rights from pension funds, compliance with the stewardship code, and post-management status should be inspected, and the results actively shared with pension funds.
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