[미디어SR 김병주 기자] The financial authorities decided to extend the easing of the liquidity coverage ratio (LCR) of banknotes, which was scheduled to end in March, by six months.
This is a follow-up measure following the extension of the loan maturity and the delay of interest repayment for new coronavirus infections (hereinafter referred to as Corona 19) by 6 months.
The Financial Services Commission announced on the 9th that it has decided to extend the period of major deregulation, including such measures. The delayed part of this period includes the easing of the bank’s LCR and the application of temporary deposit rates for banks, savings banks, and mutual finance.
First of all, the Financial Services Commission extended the deadline for deregulation of the bank’s foreign currency liquidity coverage ratio (LCR) and integrated LCR by six months. As a result, the deregulation, which was scheduled to end in March, will be temporarily extended until the end of September.
LCR is the value of high-liquidity assets divided by the expected net cash outflow over the next one month. In short, it is the minimum mandatory holding ratio of an asset that is good for monetization.
Previously, the foreign currency had to maintain 80%, and the combined KRW and foreign currency integration had to maintain at least 100%. However, taking into account the economic uncertainty caused by the Corona 19 incident, it was mitigated to 70% and 85%, respectively.
The suspension of applying the deposit-to-deposit ratio for banknotes, which was scheduled to end at the end of June, will also be maintained for another six months until the end of December. The deposit-to-deposit ratio is the ratio of loans to deposits, and commercial banks should not exceed 100%. However, this is also temporarily mitigated to 105% due to the aftermath of Corona 19.
An official from the Financial Services Commission told Media SR, “With the extension of various regulatory flexibility measures, we will continue to conduct thorough supervision and monitoring so that there is no negligence in managing the soundness of financial companies.” “He said.