The financial authorities have decided to exclude the increase in private mid-rate loans from the household loan limits of savings banks, credit finance companies, and mutual finance companies starting this month. This measure aims to encourage funding for low- and mid-credit borrowers while alleviating the burden of total loan management for the second financial sector.
According to the financial sector on the 21st, the Financial Supervisory Service convened household loan managers from the National Agricultural Cooperative Federation, the National Credit Union Federation, the National Federation of Fisheries Cooperatives, the National Forestry Cooperative Federation, the Korea Savings Bank Association, and the Korea Credit Finance Association to communicate this policy.
The financial authorities will manage the household loan increase targets for each financial institution by dividing them into their own loan share, policy finance, and reserves for additional loan demand.
Among mid-rate loans, the Saitdol loan falls under the category of policy mid-rate loans. Policy financial products like the Haet-sal Loan and Saitdol loans are managed separately as part of the total policy finance, and thus have already been excluded from the household loan limits for each financial institution.
In contrast, privately supplied mid-rate loans were previously included in the household loan limits, with only a portion of the increase excluded from total loan management. Savings banks had 80% of the increase excluded, while credit finance companies had 40%. However, starting this month, the exclusion rate will be expanded to 100% for all second financial sector institutions, including mutual finance.
A financial authority official stated, "There has been much concern as the existing incentives did not lead to the expected increase in mid-rate loans."
As a result, any increase in private mid-rate loans by the second financial sector from this month onward will not be reflected in the household loan limits for each financial institution. Since the increase in mid-rate loans will be excluded from the total, financial institutions will have more capacity to offer other household loans, such as general credit loans, within their limits.
However, even if the capacity for total loan management increases, the actual scale of loan supply is expected to vary based on each financial institution's deposits, funding costs, soundness, and capital conditions.
This measure follows the government's comprehensive real estate finance plan announced on August 13, which raised the household loan growth management target for the entire financial sector from 1.5% to 3.0% for this year. It is estimated that an additional loan capacity of about 30 trillion won will be created across the financial sector, but authorities plan to guide this supply towards actual demand and low-income financing rather than distributing it uniformly among financial institutions.
The existing management policy will remain in place for general mortgage and credit loans. Additional total loan limits for each financial institution will be allocated based on compliance with household loan targets in the first half of the year and the lending situation by sector. The specific allocation amounts have not yet been determined.
Authorities will also apply total loan management incentives to group loans, which are characterized by strong actual demand. From this month onward, the increases in moving expenses, interim payments, and final payments for group loans will be fully excluded from the household loan limits for each financial institution.
There will not be a separate limit set for group loans; instead, the increase will be deducted from the total loan management results for each financial institution, meaning the actual supply scale will depend on future demand and the individual conditions of each financial institution.
Meanwhile, total loan management incentives for mid-rate loans in the banking sector will be discussed separately from those in the second financial sector. Since the existing methods for reflecting total loans differ between banks and the second financial sector, specific measures regarding the subjects and exclusion rates will be determined after consultations with the banking sector.
* This article has been translated by AI.
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