Announcement of a plan for soft landing of corona loans that lacked poor management Private financial company’burden’

A plan for the soft landing of a corona loan worth 13.4 trillion won was revealed. The financial authorities have come up with five measures, subdividing the maturity extension and principal and interest deferral measures into measures. However, it is pointed out that the preliminary insolvent management was excluded, which put an excessive burden on private financial companies that are in charge of 70% of financial support.

According to the Financial Services Commission on the 2nd, the corona loan maturity extension and principal and interest deferral measures will be extended by six months and will be implemented until the end of September. The financial authorities explained that additional measures are inevitable as the difficulties of small and medium-sized businesses and small business owners continue due to the prolonged Corona 19.

The policy is to determine whether the final expiration of the measures to extend maturity or defer repayment in September is comprehensively determined in consideration of the quarantine, economic, and financial conditions.

Until the end of January this year, the maturity extension was 121 trillion won for a total of 371,000 cases, the deferment of principal repayment was 9 trillion won, 57,000 cases, and the deferment of interest repayment was 163.7 billion won, with 13,000 support respectively.

◆ Repayment method and period Borrower’s price is decided

The application for the extension of the repayment of the corona loan is possible until September 30th. As medium-term and small business owners who have suffered direct or indirect damage from Corona 19, there should be no delinquency such as delinquency of principal and interest, encroachment of capital, and closure of business.

The key to the soft landing plan is that the borrower decides the repayment method and duration. The Financial Services Commission is in a position to conclude the support program by providing consulting tailored to each borrower’s situation through the five principles.

The five principles are ▲ consulting on the optimal repayment plan considering the situation of the borrower ▲ Repayment period of more than the grace period in case of partial repayment of the deferred principal amount ▲ The total amount of interest accrued during the grace period is maintained regardless of the repayment period and method ▲ Intermediate repayment fee is free ▲ Final repayment The method and period are decided by the borrower.

In a case-by-case study, if a small business owner receiving a 1-year temporary repayment loan with a fixed interest rate of 60 million won and a fixed interest rate of 5% has been delayed for repayment of interest for 6 months, it is possible to repay twice as much as the existing monthly repayment amount maintained at maturity. After the grace period ends, you can repay 500,000 won each month for 6 months, plus 250,000 won of the existing interest and 250,000 won of the grace. In this case, all interests are repaid at the time of the loan expiration.

There is also a way to extend the maturity by the grace period. As in the previous case, if interest repayment is delayed for 6 months under the same loan conditions, the maturity of the lump sum payment is extended by 6 months, and after the grace period ends, a deferred interest of KRW 250,000 plus a deferred interest of KRW 250,000 per month for one year (annual interest KRW 1.5 million/ 12 months) combined with 375,000 won can be repaid.

In addition, a deferment period can be granted to extend the maturity of the lump sum payment of principal by one year and a deferred interest deferment period for six months.

The Financial Services Commission said, “We will apply the five principles of support so that various long-term and installment repayment methods can be selected in consideration of the repayment of individual borrowers.”

◆ Poor management is difficult… The burden is on the bank

The lack of’poor management’ in the FSC’s soft landing plan has increased the burden of private financial companies.

The Financial Services Commission is in a position that it closely monitors changes in the repayment ability of borrowers, such as closed business, delinquent transactions, and credit card usage, and recommends support plans for deferred repayment loans.

However, some small business owners have closed their business to extend their loans, but do not report the closure or closure of business, so it is unlikely that it will be easy to detect’insolvency’ in advance.

Earlier, the banking sector showed reluctance to defer interest repayment over the extension of the corona loan maturity and repayment deferral measures. This is because the prolonged corona19 has increased the likelihood of borrowers’ insolvency.

This is the reason why there was a voice saying that companies that are difficult to pay interest before the system extension should be rechecked to see if there was any insolvency before Corona 19.

◆ Banks may receive back interest in a year

In particular, some point out that a prolonged economic slowdown could lead to an expansion of insolvency in the financial sector.

However, the Financial Services Commission is emphasizing that the financial sector is not burdened with the delayed interest repayment performance.

The Financial Services Commission said, “Banks have increased their loans to respond to Corona 19, and are faithfully accumulating provisions compared to previous years in terms of soundness management,” and said, “We have the ability to absorb losses by preemptively accumulating provisions.”

“As of the end of last year, the delinquency rate of domestic banks was 0.28%, and the soundness indicators of domestic financial companies are in good condition.”

However, the decline in the bank’s delinquency rate has a great illusion as the total amount of loans increases. In addition, to manage the soundness of financial companies, financial authorities have recommended refraining from paying dividends by 20%.

An official from a banking sector said, “It may take more than a year to receive the backed interest,” he said. “It was also the bank’s job to manage to prevent additional insolvency caused by the extension measures.”