On the 1st, Lee Bok-hyun, Governor of the Financial Supervisory Service, stated in his New Year's address that given the high economic and political uncertainties, efforts will be made not only to stabilize the financial market and support vulnerable groups but also to enhance the competitiveness of the financial industry through financial innovation in the mid to long term.
Regarding the current economic situation, Governor Lee said, "This year, our economy is once again facing considerable uncertainty," adding, "The next Trump administration in the United States has signaled a strengthening of US-centered protectionism, and the US Federal Reserve (Fed) has declared that the pace of interest rate cuts may be slow."
He continued, "In particular, the domestic political turmoil, which is unpredictable even a step ahead, is exacerbating difficulties in the financial market," expressing concern that "with the suspension of duties of the President and Prime Minister, and Choi Sang-mok, Deputy Prime Minister and Minister of Strategy and Finance, concurrently acting as the Acting President, there is also worry about a leadership vacuum in the economic and financial sectors during this critical time."
In response, Governor Lee pledged, "We will rigorously inspect potential risks across the financial market and establish thorough response plans, induce the advancement of soundness management systems by sector and the establishment of a risk management culture, thereby supporting financial institutions to secure their own crisis response capabilities." He also promised, "We will not only manage structural risks such as household debt and real estate project financing (PF) in a stable manner but also spare no effort in considering fundamental improvements in real estate finance, including defining the roles of each financial sector."
He further emphasized strengthening the virtuous cycle structure of finance and the digital innovation ecosystem. He explained, "We will create an environment for developing investment products and encourage the expansion of venture capital supply," adding, "We will also strengthen funding supply to the underprivileged, self-employed, and small and medium enterprises to expand the co-prosperity function of finance."
He added, "While recognizing the infinite development potential of the financial industry through digital innovation, we will also manage it to ensure that digital innovation is carried out sustainably based on 'responsibility' and 'stability'." He explained that a regulatory system related to new technologies will be established to prevent gaps in financial supervision through the advancement of virtual asset supervisory systems and the establishment of IT operation governance in the financial sector.
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