The Fair Trade Commission (FTC) has issued formal examination reports to KB Kookmin, Woori, Shinhan, and Hana banks, according to industry sources.
The case centers on claims that the lenders shared approximately 7,500 data points related to loan-to-value (LTV) ratios — key figures that determine how much homebuyers can borrow against their property’s value.
Investigators say the exchanges may have allowed the banks to align lending conditions, restrict competition, and boost profits at the expense of borrowers.
The investigation, which began in early 2023, was initially expected to conclude last year but was extended after the commission opted to conduct further on-site inspections and gather additional evidence. Inspectors visited the banks in February and spent two months compiling the revised examination report.
The updated report, according to sources, bolsters claims that the data-sharing practice materially influenced lending terms. However, it also walks back an earlier recommendation for criminal prosecution, focusing instead on administrative penalties.
Notably, the FTC has widened the revenue base used to calculate fines to include loan extensions in addition to newly originated mortgages — a move that could result in penalties amounting to billions of won.
The banks have denied any collusion, arguing that while information was shared, it did not result in uniform lending practices. They point to discrepancies in their LTV ratios after the exchanges as evidence of independent decision-making.
“The deadline for the banks to submit their opinions is expected in early May,” one industry official said. “A final decision could be announced by late May or early June.”
If confirmed, the sanctions would represent the first enforcement action under the “information exchange collusion” clause added to South Korea’s Fair Trade Act in 2020 — a legal provision designed to address more subtle forms of market coordination.
A spokesperson for the Fair Trade Commission declined to comment, saying, “We cannot confirm specific details of the case.”
reporter
Kim Dong-young
davekim0807@ajupress.com
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