Disclosure of 2024 Fund Management Results
Interest Yield at 4.07%
Establishing Management Plans Through Idle Fund Forecasting
The Seoul Metropolitan Government announced on the 26th that it efficiently managed its fiscal funds during this fiscal year, earning a total of 16.38 billion won in interest income. The interest yield stood at 4.07%, which is higher than the Bank of Korea's base rate (3-3.5%). This is the first time Seoul has released the results of its fund management.
Despite a sluggish domestic and global economic environment and a downward trend in interest rates, Seoul continuously forecasted the status of idle funds by period and established short- and long-term fund management plans based on these forecasts. The city explained that by considering deposit rates for treasury deposit products and managing funds in the most advantageous way, it was able to achieve high interest income.
Currently, Seoul's funds are managed through three types of deposits at the city treasury: public deposit accounts (fixed interest rate), time deposits (variable interest rate), and corporate MMDA (variable interest rate). Most idle funds were placed in time deposits and corporate MMDA products, which offer higher interest rates. In particular, the city noted that strategically depositing and managing funds in high-yield accounts, taking into account the scale of idle funds and their disbursement schedules, played a significant role in increasing interest income.
Going forward, Seoul plans to continue disclosing interest income and yield from fiscal funds to the extent possible, thereby transparently informing citizens about the management and operation of tax-generated funds and strengthening accountability in fund management. In addition, by sharing the performance of public fund operations-which has not been accurately disclosed until now-the city expects this to serve as an opportunity to demonstrate that Seoul's funds are being managed efficiently.
Meanwhile, Seoul also plans to disclose the currently undisclosed agreed interest rates for city treasury deposits as soon as the central government establishes a disclosure policy for agreed interest rates at local government treasuries. Lee Sanghoon, Director General of Finance at Seoul Metropolitan Government, stated, "Seoul will continue to efficiently manage and operate funds in line with interest rate trends to steadily increase interest income," adding, "We will develop and implement systematic strategies to contribute as much as possible to the city's finances."
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