{"source_url": "https://www.phnompenhpost.com", "url": "https://www.phnompenhpost.com/business/koreas-financial-chiefs-eye-growth-momentum-face-challenges", "title": "Korea\u2019s financial chiefs eye growth momentum in face of challenges", "top_image": "https://www.phnompenhpost.com/sites/default/files/field/image/lee-ju-yeol.jpg", "meta_img": "https://www.phnompenhpost.com/sites/default/files/field/image/lee-ju-yeol.jpg", "images": ["https://www.phnompenhpost.com/sites/default/files/styles/thumb_380x215/public/field/image/topic-12.-illegal-demolition-in-preah-sihanouk-province-on-28-nov-2019-by-supplied.jpg", "https://i.ibb.co/KhBWC6X/Post-Finance-and-Insurance.jpg", "https://www.phnompenhpost.com/sites/default/files/logo_ppp_2.png", "https://www.phnompenhpost.com/sites/default/files/styles/thumb_380x215/public/field/image/casino_workers_seek_intervention_in_preah_sihanouk_province_on_tuesday_after_their_employer_fled._fresh_news.jpg", "https://i.ibb.co/zZRZRVS/E-papper.jpg", "https://www.phnompenhpost.com/sites/all/themes/ppp/images/logo-ppp-footer.png", "https://www.phnompenhpost.com/sites/default/files/styles/thumb_380x215/public/field/image/aeon3.jpg", "https://www.phnompenhpost.com/sites/default/files/field/image/lee-ju-yeol.jpg", "https://www.phnompenhpost.com/sites/default/files/styles/thumb_380x215/public/field/image/pnnom_penh_municipal_council_chairman_pa_socheatvong_has_said_traffic_and_waste_are_the_leading_issues_for_capital_residents._supplied.jpg", "https://i.ibb.co/mvgD93s/Post-Focus.jpg", "https://www.phnompenhpost.com/sites/default/files/styles/thumb_380x215/public/field/image/8-story-1_38.jpg", "https://i.ibb.co/K6cb29z/post-auto-03-Jan-2019.jpg", "https://www.phnompenhpost.com/sites/default/files/styles/thumb_380x215/public/field/image/tax-department-head-kong-vibol-speaks-at-a-meeting-last-year-in-phnom-penh_heng-chivoan.jpg", "https://www.phnompenhpost.com/sites/default/files/styles/image_780x440/public/field/image/lee-ju-yeol.jpg?itok=o_tWFLcv"], "movies": [], "text": "Bank of Korea governor Lee Ju-yeol speaks during a press conference on its key interest rate in Seoul on October 16. AFP\n\nKorea\u2019s financial chiefs eye growth momentum in face of challenges\n\nGearing up for the new year, South Korea\u2019s top financial officials steeled themselves to face persistent external challenges and to spark new momentum for growth.\n\nAs the trend toward low interest rates is expected to continue for a while, regulators vowed further efforts to curb the real estate bubble and promote market liquidity for innovative businesses.\n\n\u201cWe need to maintain an easing monetary policy as the domestic economy faces a slow growth pace and weak inflationary pressure on the demand side,\u201d said Bank of Korea Gov. Lee Ju-yeol in an address to employees. \u201cOur midterm goal is to support the recovery of the economy and help market prices settle within the target range.\u201d\n\nThe BOK forecast that the economy will expand 2.3 per cent in 2020, short of the theoretical growth potential of 2.5-2.6 per cent. The nation\u2019s inflation rate for 2019 stood at a record low of 0.4 per cent, much lower than the BOK\u2019s target 2 per cent.\n\nThe central bank leader also promised to pay further attention to communication so that the public can understand the delicate policy decisions needed to harmonize price stabilization and financial stabilisation.\n\nMeanwhile, the financial authorities called on the financial sector to make strides forward and nudge the economy into a rebound.\n\n\u201cI am well aware that negative perspectives toward finance continue to exist (despite the policy achievements in 2019),\u201d said Eun Sung-soo, chairman of the market regulator Financial Services Commission, in his New Year\u2019s address. \u201cIt is therefore our key task to further develop our progress so that the people may actually feel the financial changes.\u201d\n\nThe FSC chief called on the financial industry to play a more active role in the nation\u2019s economy.\n\n\u201cThe role of finance is not to sit behind and watch. It should move in step with the real economy, and each should seek to make up for the other\u2019s blind spots,\u201d he said.\n\nPointing out that market liquidity has focused excessively on real estate, instead of real industries, the chairman vowed to follow up the latest policy actions by adding momentum to regulations. On Dec. 16, the government unveiled a comprehensive set of rules to steady the housing market, including unprecedented bans on mortgage loans for expensive houses.\n\n\u201cThis year, we shall see to it that liquidity flows from households to corporations, especially small and medium-sized ones with innovative technology and growth potential,\u201d Eun said.\n\nThe market watchdog Financial Supervisory Service focused on consumer protection and potential risks arising from the overheated housing market and consequent household debts.\n\n\u201cAs the nation\u2019s risk manager, we should make all efforts to maintain the stability of the financial system in the face of various potential risks,\u201d Yoon Suk-heun, governor of the Financial Supervisory Service, said in an address to employees.\n\nWhile marginal companies and owner-operators have been weighed down by an increasing number of nonperforming loans, the real estate sector is absorbing most of the market liquidity, consequently expanding household debt risk, according to Yoon.\n\nThe FSS chief also vowed to reinforce the monitoring system for high-risk, high-income financial products for the sake of protecting consumers.\n\nHe was referring to the massive losses incurred last year due to the misselling of derivative-linked funds and securities. The FSS came up with an arbitration plan, advising sellers including Woori Bank and KEB Hana Bank to provide individual compensation of up to 80 per cent of the damages.\n\n\u201cThe advancement of fintech and (customers\u2019) drive for high incomes amid a low interest rate trend have increased the imbalance of information between financial companies and consumers,\u201d Yoon said, citing the upcoming enactment of a new bill on financial consumer protection.\n\nThe Korean Federation of Banks suggested specific midterm targets.\n\n\u201c(Financial companies) need to enhance their global competitiveness by expanding their overseas business,\u201d said KFB Chairman Kim Tae-young.\n\nOverseas business currently accounts for 5 per cent of Korean banks\u2019 total assets and 7 per cent of their net profit, according to KFB data.\n\nCiting the so-called 10-20-30 strategy, Kim urged local banks to improve those figures to 20 per cent or more within the next 10 years and recommended that top-tier financial groups aim for 30 trillion won ($25.9 billion) in market capitalisation.\n\nThe Korea Herald/Asia News Network", "keywords": [], "meta_keywords": [""], "tags": [], "authors": ["Contact Author"], "publish_date": null, "summary": "", "article_html": "", "meta_description": "Gearing up for the new year, South Korea\u2019s top financial officials steeled themselves to face persistent external challenges and to spark new momentum for growth. As the trend toward low interest rates is expected to continue for a while, regulators vowed further efforts to curb the real estate bubble and promote market liquidity for innovative businesses.", "meta_lang": "en", "meta_favicon": "https://www.phnompenhpost.com/sites/default/files/ppp_favicon.ico", "meta_data": {"og": {"image": "https://www.phnompenhpost.com/sites/default/files/field/image/lee-ju-yeol.jpg"}, "twitter": {"image": "https://www.phnompenhpost.com/sites/default/files/field/image/lee-ju-yeol.jpg"}, "description": "Gearing up for the new year, South Korea\u2019s top financial officials steeled themselves to face persistent external challenges and to spark new momentum for growth. As the trend toward low interest rates is expected to continue for a while, regulators vowed further efforts to curb the real estate bubble and promote market liquidity for innovative businesses."}, "canonical_link": "https://www.phnompenhpost.com/business/koreas-financial-chiefs-eye-growth-momentum-face-challenges"}