Lee Bok-hyeon, Chairman of the Financial Supervisory Service.ⓒ News1
Lee Bok-hyeon, head of the Financial Supervisory Service, said, “We will hold strict responsibility for financial companies that focus on short-term performance, avoid recognizing project financing (PF) losses, and use remaining financial resources on for dividends and performance bonuses. .”
According to the Financial Supervisory Service on the 23rd, Director Lee said this in an executive meeting held at the headquarters of the Financial Supervisory Service in Yeouido, Seoul this morning.
Director Lee said, “The need to liquidate insolvent real estate PF loans is increasing as the PF delinquency rate in savings banks and other institutions has increased and the number of businesses at risk of insolvency has increased,” adding, “However, the resolution of insolvent businesses, such as extending the maturity of even businesses that are difficult to carry out normal business, is increasing.” “It’s progressing slowly,” he said.
According to the Financial Supervisory Service, the PF delinquency rate in the financial sector rose from 1.19% at the end of 2022 to 2.42% at the end of September last year.
Director Lee said, “PF insolvency needs to be eliminated more quickly,” and added, “For PF businesses that do not have business viability, such as bridge loans that cannot be converted to PF for a long period, in principle, 100% of’ r expected losses will be recognized at the end of 2023 and provision will be made.” He asked, “Save and sell and unwind quickly.”
In addition, “For PF business sites where construction delays continue or the sales rate is significantly low, strengthen the build-up of provision step by step, taking into account loss rates experienced in the worst situations in the past,” and “Given the possibility of further price drops during loss compensation processes such as auctions and public auctions, “The collateral value must be calculated strictly,” he said.
The Financial Supervisory Service intends to scrutinize the provision status of financial companies as soon as the financial statements are completed at the end of 2023.
(Seoul = News 1)
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