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  • Record Heat Strains Power Grid, Urgent Need for Redesign
    Record Heat Strains Power Grid, Urgent Need for Redesign Amid record-breaking heat, maximum power demand reached 95.321 GW on August 7, marking the highest level this summer and the fifth highest on record. The supply reserve ratio fell to 9%, dipping below the typically stable threshold of 10%.This challenge is not limited to this year. As climate change progresses, heat waves and tropical nights are likely to become more frequent and prolonged. The current extreme heat is not just a seasonal issue but signals a structural risk that could recur for decades. The overlap of peak power demand with heat waves may become a new normal. Additionally, the power demand from artificial intelligence (AI) and advanced manufacturing is rapidly increasing. It is time to redesign the power grid to accommodate not only historical average demand but also the impacts of extreme weather and changes in industrial structure.AI data centers and semiconductor factories require stable power around the clock. Simply having enough electricity is not sufficient; stability in voltage and frequency, the risk of outages, and power quality all influence corporate investment decisions. This is why the competitiveness of AI is directly linked to power reliability.The spatial structure of the national power grid needs to be reconfigured. Currently, it resembles a centralized system where power generated at large plants is sent to consumption areas like the capital region. A strategy to distribute the concentrated power demand in the capital region to other areas is necessary. Placing AI data centers and advanced industrial complexes in regions with favorable power generation conditions, and developing power sources in conjunction with industrial parks, should be actively considered. This approach can enhance both regional balanced development and power grid stability. When determining the location of industrial complexes, factors such as land, water, and transportation should be considered alongside the amount of power that can be secured and the transmission network available in 20 years.To respond to climate change, the flexibility of the power grid must also be increased. As the share of variable renewable energy sources like solar and wind grows, the fluctuations in power generation will become more pronounced. To mitigate this, expanding energy storage systems (ESS) and actively utilizing demand response (DR) and smart grids are essential. A system must be established to store electricity when production is high and draw it during peak demand periods. Connecting electric vehicles and industrial equipment to the power grid can create a new system where consumers participate in managing power supply and demand.The transmission network should be constructed proactively based on long-term demand forecasts. Institutional improvements are essential to resolve community acceptance and permitting issues. The power grid must be defined as a critical national infrastructure, with a system in place to quickly resolve conflicts that arise during project implementation. The composition of power sources should also combine the advantages of nuclear, renewable, gas generation, and ESS to ensure both stability and economic efficiency. The key is the ability to reliably supply the necessary amount of power whenever and wherever it is needed. This is why national industrial policy and power policy cannot be viewed separately.The government claims it has secured sufficient supply capacity and additional reserve resources for this summer. However, successfully navigating this summer's challenges and preparing for decades of future power demand are entirely different issues. As heat waves recur and the AI industry grows, the likelihood of breaking new records for maximum power demand increases. The power grid is a national infrastructure that will be used for decades once established. What is needed now is not a temporary fix to get through this year's crisis, but a comprehensive redesign of the national power supply network that can withstand climate change and industrial transformation.* This article has been translated by AI. 2026-08-09 15:24:00
  • SK Hynix Employee Sentenced for Trade Secret Theft
    SK Hynix Employee Sentenced for Trade Secret Theft A former employee of SK Hynix has been sentenced to prison for stealing trade secrets after receiving a job offer from a subsidiary of Chinese telecommunications company Huawei. On August 9, the Seoul High Court's Criminal Division 10-1 (Judges Lee Sang-ho, Lee Jae-shin, and Lee Hye-ran) upheld the original sentence of 1 year and 6 months in prison for Kim, who was charged with violating the Industrial Technology Protection Act and the Unfair Competition Prevention Act. Kim was accused of unlawfully leaking and misusing advanced technology and trade secrets related to the company's CIS (COMS Image Sensor) while working at SK Hynix's local subsidiary in China in 2022. It was confirmed that Kim committed the crime after receiving a job offer from HiSilicon, a subsidiary of Huawei. He reportedly violated security regulations by printing or photographing trade secret documents from the company's internal document management system for use in his resume. The first trial court found Kim guilty of leaking trade secrets and sentenced him to prison. However, he was acquitted of charges related to leaking information on hybrid bonding technology necessary for implementing High Bandwidth Memory (HBM) used in artificial intelligence. The appellate court also found no legal errors in the first trial's judgment. The court criticized Kim, stating, "The defendant leaked a large amount of trade secrets and disclosed them by submitting a resume to a Chinese company, indicating the severity of the crime." However, the court considered Kim's acknowledgment of his crimes and the fact that most of the leaked trade secrets were recovered as mitigating factors in sentencing.* This article has been translated by AI. 2026-08-09 15:20:10
  • Typhoon Chan-Hom Approaches Korea: Projected Path and Impact
    Typhoon Chan-Hom Approaches Korea: Projected Path and Impact Typhoon Chan-Hom is currently moving over the waters east of Japan, drawing attention from those planning trips to Japan during the vacation season regarding its projected path and potential impact on the Korean Peninsula.According to the Korea Meteorological Administration (KMA) on August 9, Typhoon Chan-Hom (No. 15) is moving over the distant waters east of Japan.Chan-Hom formed on August 5 over the waters southeast of Tokyo, Japan. The name, submitted by Laos, refers to a type of tree.The KMA's latest forecast indicates that the likelihood of Chan-Hom directly impacting the Korean Peninsula is currently low.Chan-Hom is expected to move along the waters east of Japan and gradually weaken. The KMA predicts that it will downgrade to a tropical depression within the next 72 hours.As a result, if it continues on its current projected path, it is unlikely that South Korea will be directly affected by Chan-Hom.However, regardless of the typhoon's direct impact, caution is advised regarding changes in surrounding atmospheric pressure systems.Currently, weather conditions in South Korea vary significantly by region. While the western areas are experiencing a heat wave, some locations along the east coast are receiving rain due to easterly winds.The expected path and intensity of the typhoon may change depending on surrounding atmospheric conditions, so it is important to stay updated with the latest weather information.* This article has been translated by AI. 2026-08-09 15:20:10
  • Special Prosecutors Office Approaches Conclusion on Key Cases
    Special Prosecutor's Office Approaches Conclusion on Key Cases The second comprehensive special prosecutor team, led by Kwon Chang-young, is moving towards concluding its investigations, with two weeks remaining before its activities end. The team has begun indicting key suspects, although significant inquiries remain, raising questions about the outcomes of ongoing allegations.According to legal sources on the 9th, the special prosecutor's office is focusing on a 'Heavy Tail' strategy in the latter stages of its investigation, concentrating on the indictment of major suspects.On August 7, the special prosecutor indicted Shin Yong-ha, former head of the Ministry of Justice's correctional headquarters, on charges related to insurrection, while Yoo Byung-ho, a member of the Board of Audit and Inspection, was indicted on charges of abuse of authority.Since its launch in February, the special prosecutor has indicted a total of 11 individuals. Specifically, in June, former Chief of Staff Kim Dae-ki and former Secretary Yoon Jae-soon were indicted on charges of abuse of authority related to allegations of favoritism in the relocation of the presidential office. Former Administrative Secretary Kim O-jin and former Minister of the Interior and Safety Lee Sang-min were indicted without detention.The special prosecutor has also taken action regarding allegations of involvement in martial law by the Joint Chiefs of Staff. Former Chairman Kim Myung-soo was indicted without detention, while former Deputy Chief Jeong Jin-pal, former Deputy Chief of the Inspection Division Lee Jae-sik, and former Army Headquarters Policy Director Kim Heung-jun were indicted with detention.Additionally, on July 29, former National Security Office First Deputy Director Kim Tae-hyo was indicted for allegedly delivering messages to allied countries to justify the martial law declaration.The special prosecutor is expected to exert full effort to wrap up major cases in the remaining time. Among the cases handled by the Kim Geon-hee special prosecutor team, the allegations regarding the Yangpyeong Expressway and the relocation of the presidential office remain unresolved.The allegations regarding the change in the endpoint of the Yangpyeong Expressway surfaced after the start of the Yoon Suk-yeol administration, as the endpoint was changed to a location owned by Kim Geon-hee's family. The special prosecutor only managed to indict a civil servant from the Ministry of Land, Infrastructure and Transport for abuse of authority.The special prosecutor has summoned former Minister of Land, Infrastructure and Transport Won Hee-ryong twice to investigate the allegations, but stated, "The testimonies from related parties regarding the route change have not been properly made, leaving the investigation at a standstill."In connection with the allegations of favoritism in the relocation of the presidential office, Kim Geon-hee is under investigation. She is accused of receiving money from 21Gram and facilitating a construction contract for 21Gram, which lacks qualifications as a general construction company. She underwent her first investigation by the special prosecutor on July 22. In response, her legal team has countered that the special prosecutor's claims are one-sided. Additionally, lawmakers Yoon Han-hong and Kim Tae-young, the representative of 21Gram, are also under investigation.The investigation into allegations of stock manipulation involving Deutsche Motors is also expected to yield a decision soon. Former Prosecutor General Shim Woo-jung, former Seoul Central District Prosecutor Lee Chang-soo, and former Deputy Chief of the Anti-Corruption Division Choi Jae-hoon have been summoned as suspects, with a decision on their indictment anticipated within two weeks.Among the insurrection cases, the investigation into former Prosecutor General Shim remains unresolved. The special prosecutor suspects that Shim participated in the martial law by considering dispatching to the joint investigation headquarters at the direction of former Minister of Justice Park Sung-jae. The special prosecutor has conducted a search of the Supreme Prosecutor's Office and continued investigations into Shim, but a request for an arrest warrant was denied by the court.Decisions regarding former National Intelligence Service First Deputy Director Hong Jang-won and former Army Capital Defense Command First Guard Commander Jo Sung-hyun are also expected in the future. The insurrection special prosecutor team has not filed charges against them, but has conducted multiple investigations, asserting that their involvement in insurrection-related duties has been substantiated. Given the differing judgments on the same case, if the special prosecutor proceeds with indictments, legal disputes are likely to continue throughout the trial process.* This article has been translated by AI. 2026-08-09 15:04:00
  • SK chiefs lengthy divorce case nears end as appeal deadline looms
    SK chief's lengthy divorce case nears end as appeal deadline looms SEOUL, August 9 (AJP) - Attention is turning to whether the long-running property division dispute between SK Group Chairman Chey Tae-won and his wife Roh So-yeong will finally come to an end after nearly a decade. According to legal sources Sunday, the deadline for the estranged couple to file a final appeal against the Seoul High Court's ruling delivered late last month in the case, which was sent back to the appellate court for retrial, is approaching. In its ruling on July 24, the court ordered Chey to pay his ex-wife 944 billion won in property division. Chey and Roh have 15 days from receiving formal notice of the ruling to file a final appeal, with the deadline falling on Aug. 15. If neither side appeals, the ruling will become final. The deadline can be extended to the next business day if it falls on a Saturday or public holiday. In this case, the deadline would be Aug. 18, as Aug. 15, Liberation Day, falls on a Saturday and Aug. 17 is a substitute holiday. Their marital dispute began in 2017, after Chey revealed in December 2015 that he had a child out of wedlock and later filed for divorce when the couple failed to reach an agreement on the terms of their separation. In the first trial in December 2022, the court ordered Chey to pay Roh 100 million won in alimony and 66.5 billion won in property division. But in May 2024, the Seoul High Court sharply raised those amounts, ordering Chey to pay 2 billion won in alimony and 1.38 trillion won in property division, citing a 30 billion won slush fund that Roh’s father, the late former President Roh Tae-woo, had funneled into SK Group. But the Supreme Court ruled in October last year that the slush fund was illegal money and could not be counted as Roh's contribution to the couple's wealth. It upheld the 2 billion won in damages but sent the property division case back to the Seoul High Court for retrial. At the retrial on July 24, the appellate court ordered Chey to pay Roh 944 billion won in property division, again ruling that his SK shares were subject to division, but recalculating the amount as orderd by the top court, making it the largest divorce settlement in the country's history. If either side appeals, the case will once again be heard by the top court. Chey, the chief of the country's second-largest conglomerate after Samsung, married Roh in September 1988 and have three children between them. Now it remains to be seen whether the lengthy legal battle over the largest divorce settlement in the country's history will finally come to a close. AJP Takeaways: - The deadline for SK Group Chairman Chey Tae-won and his estranged wife Roh So-yeong to file a final appeal against the Seoul High Court's July 24, 2026, retrial ruling in their property division case falls on Aug. 18, 2026. - In its July 24, 2026, ruling, the Seoul High Court ordered Chey Tae-won to pay Roh So-yeong 944 billion won in property division, making it the largest divorce settlement in South Korean history. - The Supreme Court of South Korea ruled in October 2025 that a 30 billion won slush fund linked to Roh So-yeong's father, the late former South Korean President Roh Tae-woo, was illegal money and could not be counted as Roh So-yeong's contribution to the couple's wealth; the court sent the property division case back to the Seoul High Court for retrial while upholding a separate 2 billion won alimony award. - The property division dispute between Chey Tae-won and Roh So-yeong began in 2017, after Chey Tae-won disclosed in December 2015 that he had a child outside the marriage and later filed for divorce when the couple could not agree on separation terms. - If either Chey Tae-won or Roh So-yeong appeals the July 24, 2026, ruling by the August 18, 2026, deadline, the case will be heard again by the Supreme Court of South Korea; if neither appeals, the ruling becomes final. 2026-08-09 15:02:47
  • Toss Bank Establishes Dedicated Data Analysis Team, Appoints Kakao Veteran as Leader
    Toss Bank Establishes Dedicated Data Analysis Team, Appoints Kakao Veteran as Leader Toss Bank is consolidating its data capabilities, creating a dedicated data analysis team and hiring an external expert to enhance its data-driven decision-making processes.According to the financial sector on August 9, Toss Bank has recently established a dedicated data analysis organization within its data division. The new team will be led by Lee Jae-heon, who previously worked at Kakao.Lee has extensive experience in data analysis, having worked at financial and fintech companies such as Samsung Card, K Bank, KB Kookmin Card, and Kakao Pay. He served as the head of the data analysis team at Kakao Pay and later managed corporate initiatives and new business at Kakao. He is recognized as an expert in building data-driven decision-making systems across various sectors, including finance, fintech, and big tech.At Toss Bank, Lee will lead not only the new team but also the data analysis personnel scattered across various departments, aiming to enhance the bank's overall data analysis capabilities.As an internet-only bank, Toss Bank relies heavily on data analysis for personalized financial services, credit assessments, risk management, and marketing efficiency, all of which impact the bank's profitability and stability. By analyzing customer financial transactions and service usage patterns, the bank can offer tailored products and utilize data for loan assessments and risk management.Toss Bank is also strengthening its leadership in technology. It has appointed Song Tae-hwa, who previously led the server platform organization, as the Chief Operating Officer and the head of server development technology. This move aims to drive key initiatives such as technology internalization and system advancement at the executive level.The bank is actively seeking talent as well. Toss Bank is conducting an internship program linked to server developer recruitment until August 17, planning to select a double-digit number of interns. These interns will participate in product, service, and platform development for six months, with opportunities for outstanding candidates to transition to full-time positions. The program aims to provide hands-on experience in core banking areas such as lending, deposits, cards, and asset management, ensuring that the bank secures talent with a solid understanding of the financial domain and development capabilities.A Toss Bank representative stated, "We plan to enhance our overall data utilization capabilities and technological foundation by strengthening leadership in data analysis and server development. Based on this, we aim to improve our service competitiveness and reliability, providing customers with more convenient and trustworthy financial services."* This article has been translated by AI. 2026-08-09 15:00:20
  • Countdown to Delisting for Penny Stocks as 48 Companies Face Management Designation
    Countdown to Delisting for 'Penny Stocks' as 48 Companies Face Management Designation According to the Korea Exchange and the Financial Supervisory Service, as of August 7, a total of 48 companies, including 10 on the KOSPI and 38 on the KOSDAQ, have announced concerns about being designated as management items due to their stock prices falling below 1,000 won. This announcement comes just over a month after the government implemented stricter conditions for maintaining listings. On August 5, 43 of these companies made their announcements in a single day, following the new delisting criteria that require companies with stock prices below 1,000 won for 25 consecutive trading days to disclose their status. Companies that made announcements on August 5 must raise their stock prices above 1,000 won by August 12 to avoid being designated as management items starting August 13. Under the new regulations, a company will be designated as a management item if its stock price remains below 1,000 won for 30 consecutive trading days. To exit this designation, a company must maintain a stock price above 1,000 won for 45 out of 90 trading days. If the stock price does not recover, the company will enter the delisting process. Once designated, it is challenging for companies to return to normal status. The number of companies at risk of designation may increase. As of August 7, there are approximately 160 listed companies with stock prices below 1,000 won, including 32 on the KOSPI and 131 on the KOSDAQ. This indicates that not only the companies that have announced concerns but also those that fail to rebound in stock price may sequentially enter the delisting process. The tightening of market capitalization standards is also putting pressure on small listed companies. Since last month, the criteria for management designation have been raised from 20 billion won to 30 billion won for KOSPI companies and from 15 billion won to 20 billion won for KOSDAQ companies. Consequently, since the new criteria took effect on August 1, 56 companies have announced concerns about management designation due to insufficient market capitalization, including 12 on the KOSPI and 44 on the KOSDAQ. Among these, 28 have already been designated as management items. As of August 7, there are 41 companies on the KOSPI and 194 on the KOSDAQ that do not meet the market capitalization criteria. Notably, 10.6% of the 1,820 companies listed on the KOSDAQ are currently below the threshold. With the simultaneous tightening of stock price and market capitalization requirements, the pressure for delisting is intensifying, particularly for smaller companies. Companies are attempting to boost their stock prices and market capitalizations through methods such as capital increases, share buybacks, stock consolidations, and mergers and acquisitions (M&A). However, stock consolidations often lead to further declines in stock prices, and capital increases raise concerns about share dilution. M&A processes are also complicated and difficult to execute in the short term. A financial industry official stated, "Given the limited options for quickly raising stock prices and market capitalizations, there is a high likelihood of continued cases of management designation and delisting. For companies with sound performance and financial structures, it is essential to closely examine their business improvements and self-rescue measures rather than solely relying on stock prices to assess their value." * This article has been translated by AI. 2026-08-09 14:44:00
  • Housing Crisis Intensifies in Yeouido and Mokdong Ahead of Major Relocations
    Housing Crisis Intensifies in Yeouido and Mokdong Ahead of Major Relocations Seoul's prominent reconstruction areas, Yeouido and Mokdong, are facing a housing crisis as large-scale relocations approach. With multiple redevelopment projects accelerating, the demand for temporary housing is rising, while rental listings are dwindling. Concerns are growing that a tax reform aimed at enhancing benefits for primary residents could lead to more landlords reclaiming rental properties for personal use, further tightening the rental market.According to the construction industry on August 9, the Daegyo Apartment in Yeouido, which received approval for its management plan on May 19, is set to begin relocations around October. Originally built in 1975, the Daegyo Apartment will be reconstructed from 576 units to a maximum of 912 units across 49 floors. The association aims to demolish the existing structure and start construction next year, targeting completion by 2031.Similarly, the Hanyang Apartment is preparing for relocation in the second half of this year as it completes the final steps of its management plan. This project will transform the existing 588 units into a mixed-use complex with 992 residential units and 60 officetels, with the approval process registered on August 5 in the Seoul city redevelopment project database.If the relocation timelines for Daegyo and Hanyang overlap, up to 1,164 households in Yeouido will need to find new accommodations simultaneously. Residents prefer temporary housing within Yeouido or nearby areas such as Mapo, Gongdeok, and Mokdong to maintain their community ties. Families with school-aged children face even fewer options, as they are reluctant to leave their established school districts.An analysis of ongoing or upcoming relocations based on Seoul's redevelopment plans estimates that around 20 projects, involving over 15,000 units, will require new housing this year. The demand for relocation is concentrated in nearby areas to maintain existing community ties and school districts, making it more complex than simply matching the number of relocating households with available housing. If multiple projects coincide, it could place additional pressure on rental supply and prices in specific regions.The tax reform focused on primary residency is also seen as a potential variable in the rental market. While the current shortage of rental units cannot be solely attributed to the tax changes, an increase in tax burdens on non-residential properties may lead landlords to sell or occupy their properties, reducing the existing rental supply.A representative from a real estate agency near Yeouido's Shibum Apartment noted, "Landlords with larger units or significant capital gains are contemplating selling before the deduction limits decrease. Additionally, more landlords who have held properties for a long time but have short-term tenants are expressing intentions to move in themselves once leases expire."As the number of people seeking temporary housing increases due to reconstruction, a decrease in rental units could also impact the relocation schedules of subsequent projects. The Yeouido Shibum and Gongjak Apartments are also progressing through their procedures, making it crucial to stagger the relocation timelines as project speeds increase.A representative from a real estate agency near Yeouido stated, "With Daegyo and Hanyang moving forward with their relocation and demolition processes, subsequent projects are likely to accelerate as well. Given the current shortage of rental units, it will be challenging for multiple complexes to relocate simultaneously, necessitating staggered schedules."In Mokdong's Yangcheon District, where the redevelopment project is larger, the rental supply will also be a key factor in future reconstruction efforts. The Mokdong New Town project aims to rebuild the existing 26,629 units into approximately 47,000 units. As all 14 complexes have completed their designation as redevelopment zones and are entering subsequent procedures, there are concerns that relocation demand may concentrate at specific times.The relocation issue has become a significant condition for projects on-site. DL E&C, which won the bid for Mokdong District 6, has proposed 100% loan-to-value support for relocation costs and a four-year deferral for member contributions. Given Mokdong's characteristics, where families with school-aged children have a strong preference to remain in the area, once relocations begin, demand in the Mokdong and Sinjeong-dong rental markets is expected to surge.A representative from a real estate agency in Sinwol-dong remarked, "There are many outside residents or single-homeowners from other regions who have already purchased homes nearby. If landlords choose to move in after their leases expire to reduce tax burdens, the rental supply in the area could become even tighter when reconstruction relocations commence."A member of a Mokdong reconstruction preparation committee stated, "The impact of the tax reform will first manifest in landlords' decisions to hold or occupy their properties. If the rental supply tightens further, it could pose challenges for large-scale relocations in upcoming redevelopment projects."* This article has been translated by AI. 2026-08-09 14:40:00
  • One in Ten Construction Firms Classified as Marginal Companies Amid Financial Struggles
    One in Ten Construction Firms Classified as 'Marginal Companies' Amid Financial Struggles The profitability and financial health of external audit-targeted construction firms have deteriorated for five consecutive years, with marginal companies now exceeding 11% of the total, indicating a structural downturn in the construction industry.The Korea Construction Industry Institute reported on August 9 that an analysis of the management performance of 2,004 construction firms with available financial statements from 2021 to 2025 revealed this trend. External audit-targeted companies are those subject to external audits.Marginal companies are defined as those with an interest coverage ratio below 1 for three consecutive years, meaning they cannot cover interest expenses with operating profits. The number of marginal companies increased from 62 (4.5%) in 2021 to 173 (11.3%) in 2025, marking a 2.8-fold increase over five years.Overall profitability has also worsened. The operating profit margin dropped from 4.5% to 3.4%, while the net profit margin fell from 4.2% to 2.3%. The debt ratio rose from 129.2% to 155.3%, and the revenue growth rate declined from 17.9% to -4.5%.The financial structure has deteriorated as well. The debt ratio soared from 129.2% in 2021 to 161.8% in 2024, before slightly decreasing to 155.3% in 2025, still higher than in 2021. The current ratio fell from 282.6% in 2021 to 232.3% in 2024, indicating reduced capacity to repay short-term debts.Particularly notable is the decline in the building sector within the comprehensive construction industry. The net profit margin in the building sector plummeted from 5.0% in 2021 to 1.0% in 2025, while the debt ratio surged from 204.8% to 256.3%.In contrast, the civil engineering sector saw a smaller decline in net profit margin, dropping from 4.3% to 3.5%, with the debt ratio increasing slightly from 97.5% to 106.7%. This disparity is attributed to adjustments in the housing and sales market, as well as risks associated with project financing and unsold properties concentrated in the building sector.Regionally, vulnerabilities differed between the metropolitan and non-metropolitan areas. Non-metropolitan areas were relatively weaker in terms of profitability and the proportion of marginal companies. The share of marginal companies in non-metropolitan areas rose from 5.1% in 2021 to 12.9% in 2025, surpassing the 9.8% in the metropolitan area.Conversely, the metropolitan area faced relatively higher liquidity burdens. The current ratio in the metropolitan area decreased from 244.9% in 2021 to 216.0% in 2025, lower than the 270.6% in non-metropolitan areas. The revenue growth rate in the metropolitan area also fell significantly from 19.2% in 2022 to -6.2% in 2025, indicating a larger adjustment compared to non-metropolitan areas.Lee Ji-hye, a researcher at the Korea Construction Industry Institute, stated, "The poor performance of external audit-targeted construction firms reflects structural issues compounded by economic slowdown, rising construction costs, project financing risks, financial burdens, and delayed payments. It is particularly urgent for comprehensive construction firms to improve their financial structures and strengthen risk management."* This article has been translated by AI. 2026-08-09 14:40:00
  • Savings Bank Deposit Rates Decline Again as 4.5% Products Disappear
    Savings Bank Deposit Rates Decline Again as 4.5% Products Disappear The average interest rate for one-year time deposits at savings banks, which once approached 4%, has begun to decline again. This shift comes as funds that had flowed into the stock market are now returning to deposits, easing the pressure on securing deposits, while household loan regulations limit available investment options.According to the Korea Federation of Savings Banks on August 9, the average interest rate for one-year time deposits across 79 savings banks nationwide is now 3.78%. This marks a decrease of 0.17 percentage points from 3.95% on July 8, when competition for deposits was at its peak.High-interest products offering rates above 4% are also rapidly disappearing. The number of one-year time deposit products with a base interest rate of 4% or higher has dropped from 336 on July 8 to just 139 today. Products offering 4.5% interest have completely vanished, down from 38.The savings bank sector had raised deposit rates in response to a 'money move' as funds exited to the stock market following the KOSPI index surpassing 9,000 in June. However, with the recent slowdown in the stock market, idle funds have started to flow back into deposits, leading to a reduction in rate competition.Indeed, the deposit balance at savings banks is showing signs of recovery. According to the Bank of Korea's economic statistics system, the balance of mutual savings banks, which had fallen to around 98 trillion won in December of last year, rebounded to 100.66 trillion won in April and has remained above 100 trillion won in May.The lack of sufficient lending opportunities is also cited as a reason for the easing of rate competition. With financial authorities continuing to manage the total volume of household loans, savings banks are finding it difficult to aggressively increase their loan assets. Even if they secure deposits by offering high interest rates, the inability to lend those funds could lead to increased interest costs on deposits, thereby straining profitability.However, there remains a possibility that savings bank deposit rates could rise again. The decision by the Bank of Korea in October regarding any further increases in the base rate will be a key factor. Some analysts predict that the Bank of Korea may raise the base rate once more. If the base rate increases, market interest rates and the cost of funding for financial institutions will also rise, potentially prompting savings banks to raise deposit rates again.Seo Ji-yong, a professor at Sangmyung University, stated, "With the total volume of loans being regulated, the lending capacity of savings banks is limited. Recently, the sector has also focused on maintaining soundness, making it difficult to actively expand lending. Consequently, it appears that the competition for deposit rates is being adjusted somewhat."* This article has been translated by AI. 2026-08-09 14:36:00