ID :
202240
Fri, 08/19/2011 - 06:16
Auther :
Shortlink :
https://oananews.org//node/202240
The shortlink copeid
Regulator urges banks to lift home loan suspensions
SEOUL, Aug. 19 (Yonhap) -- South Korea's financial regulator urged three local banks Friday to back down from their suspensions of fresh home loans amid mounting criticism over the surprise move.
The call by Financial Supervisory Service (FSS) Gov. Kwon Hyouk-se came a day after major lenders Shinhan Bank, Hana Bank and Nonghyup said they will halt new home loans, including mortgage lending and some types of credit loans, until the end of August.
"The FSS will instruct banks to refrain from unnecessary lending but to continue to make necessary loans," Kwon told Yonhap News Agency by phone. "A complete halt in lending should not happen in any situation."
The government plans to sustain its policy goal of keeping the household debt level in line with the country's economic growth, he added.
In late June, the government unveiled a set of measures to curb snowballing household debt by tightening banks' loan-to-deposit ratios and mending banks' lending practices.
The country's household debt surpassed the 800 trillion won (US$746.4 billion) mark as of end-March due to a long streak of low rates and the economic recovery.
Meanwhile, the top regulator called on local insurers and non-life insurers to beef up their capital and reduce dividends to brace for further worsening of external uncertainties.
In a meeting with insurance company heads, Kwon said insurers' holdings of equity investment are low at 6.6 percent, but warned their asset qualities could worsen if the ongoing financial instability stemming from Europe and U.S. woes persists.
The call by Financial Supervisory Service (FSS) Gov. Kwon Hyouk-se came a day after major lenders Shinhan Bank, Hana Bank and Nonghyup said they will halt new home loans, including mortgage lending and some types of credit loans, until the end of August.
"The FSS will instruct banks to refrain from unnecessary lending but to continue to make necessary loans," Kwon told Yonhap News Agency by phone. "A complete halt in lending should not happen in any situation."
The government plans to sustain its policy goal of keeping the household debt level in line with the country's economic growth, he added.
In late June, the government unveiled a set of measures to curb snowballing household debt by tightening banks' loan-to-deposit ratios and mending banks' lending practices.
The country's household debt surpassed the 800 trillion won (US$746.4 billion) mark as of end-March due to a long streak of low rates and the economic recovery.
Meanwhile, the top regulator called on local insurers and non-life insurers to beef up their capital and reduce dividends to brace for further worsening of external uncertainties.
In a meeting with insurance company heads, Kwon said insurers' holdings of equity investment are low at 6.6 percent, but warned their asset qualities could worsen if the ongoing financial instability stemming from Europe and U.S. woes persists.
