FSS Holds 2025 Banking Sector Financial Supervision Briefing
Focus on Capital Ratios and Loan Management Status
Crackdown on Incomplete Sales Practices
On the 11th, the Financial Supervisory Service (FSS) announced that it held the '2025 Banking Sector Financial Supervision Briefing' at its headquarters in Yeouido, Seoul. The event was attended by executives and employees of banks and bank holding companies, as well as representatives from the Korea Federation of Banks.
Park Chung-hyun, Deputy Governor of the FSS, stated, "The banking management environment is becoming challenging due to the recent increase in domestic and international uncertainties," and urged, "Overcoming this requires joint efforts between the supervisory authorities and the banking sector."
Regarding this year's supervision and inspection directions, he explained, "We plan to focus on guiding and inspecting capital ratios and loan handling and management status to respond to the potential decline in banks' profitability caused by the deterioration of vulnerable sectors due to real economy difficulties and the realization of interest rate cuts."
He emphasized, "In particular, we will strengthen risk supervision related to asset and product concentration such as household debt, and induce banks to enhance proactive foreign currency liquidity response capabilities in preparation for trade disputes and increased exchange rate volatility."
Deputy Governor Park added, "To improve the quality of internal control, we will guide the establishment of accountability structures and the stabilization of internal control innovation plans, and strictly respond to any deficiencies. We will actively support the creation of a sound organizational culture in banks through compliance reporting and enhanced communication with the board of directors and management. Additionally, we will conduct thorough inspections of all stages of sales activities, including performance systems, to eradicate pushy sales practices, which are the root cause of incomplete sales."
He also said, "This is a critical time for banks' roles in fund intermediation and social responsibility. We ask banks to continue activating fund supply to productive sectors and expanding financial support for vulnerable groups. As the industrial environment rapidly changes with the spread of new technologies and digital transformation, we will spare no supervisory policy support to ensure that the banking industry becomes a driving force for innovation and development."
The FSS stated that it plans to actively reflect the various opinions and suggestions discussed at this briefing in its future supervision and inspection tasks.
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