As banks cut off credit loans to new households at the end of the year, office workers and self-employed people in need of emergency are having difficulty in financing. On the 23rd, a commercial bank’s personal loan window was empty. Reporter Kim Youngwoo [email protected] “/>
As banks cut off credit loans to new households at the end of the year, office workers and self-employed people in need of emergency are having difficulty in financing. On the 23rd, a commercial bank’s personal loan window was empty. Reporter Kim Youngwoo [email protected]
Kim, 61, who runs a chicken restaurant in Gwancheol-dong, Seoul, waits for the New Year to come. This is because the main bank said, “It is difficult to make a loan until the end of the year” and asked to see you again at the beginning of the year. Mr. Kim’s customers were cut off, but more than 2 million won was lost in the bankbook due to monthly rent of 1.87 million won and gas bills and electricity bills. It has been a long time since the 10 million won, which was prepared as a secondary loan for small business owners in July, was used up. Mr. Kim confided, “I am looking forward to the flyers of the loan companies that are scattered on the door of the store every morning, but I am holding on to them.”
The middle class and common people are being driven to the’loan cliff’. This is because banks suddenly raised the threshold of household loans. Commercial banks such as Shinhan Kookmin Hana Woori are demanding that new personal credit loans be blocked from mid-month or to repay 10-20% of the principal if the maturity is extended. Kakao Bank and K-Bank are also raising their loan interest rates or lowering their loan limits. The financial authorities are pressing to reduce the total amount of loans.
The self-employed and the common people, whose financing has been difficult, are paying high interest rates and turning to the second financial sector and illegal private finance. According to the Financial Supervisory Service on the 25th, household loans in the 2nd financial sector, such as card capital savings bank insurance, rose 4.700 billion won compared to the previous month, recording the largest increase in history.
As bank loans are tightened, the’balloon effect’ of finding new sources is expected to intensify. The problem is that the’loan turmoil’ will continue next year, which can drain the finances of the common people. This is because financial authorities are tightening household loans to banks. The Financial Supervisory Service demanded that major banks increase the share of corporate loans to 50-60%. The share of corporate loans from the five major banks is 45.3~48.7%. It is an analysis that there is no choice but to curb household loans.
An official from a commercial bank said, “It is unlikely that the household loan conditions will improve next year.” It is pointed out that the government is trying to prevent the surge in house prices, triggered by the failure of real estate policies, with loan regulations, and that the Aman common people are suffering damage as their money lines are blocked.
‘Loan Cliffs’ ringing in common people
Banks struggling to tighten government regulations
Mr. Lee, a 30-year-old office worker, is struggling because he couldn’t find a dispatch. I’m looking into a company’s society loans and savings banks, and I’m going to open my hands to my parents. This is because the bank received a call to repay 30 million won out of 130 million won in the principal or repay other credit loans a month before the credit loan maturity. Mr. Lee protested, “Suddenly where to get the money,” but he had to hear that “there is no help because government regulations are strengthened.”
As banks take intensive measures, such as “to stop all personal credit loans,” there are people who are driven to the “loan cliff”. It seems that the government’s regulation on the total amount of loans to block the funding lines of high-income families is spreading to the general public, including office workers and small business owners. The government’s measures to fix the house price are sparking fire on the afflicted common people.
The general public and small businesses are also’credit loan crisis’
According to the financial sector on the 25th, there are a number of people who have recently been informed by banks that they will extend the maturity by repaying part of the principal of the credit loan. In the internet community of office workers, you can easily find articles that profess banks and governments. There are many extreme cases, such as’received to repay 30% of the principal’ or’it was said that it could be extended only for 6 months’. A branch manager of a commercial bank said, “The government has stepped forward to fully introduce the DSR regulation next year.” I recommend putting them in or looking through the other bank’s negative bankbook.”
Small businessmen faced greater difficulty than office workers. As the situation of the novel coronavirus infection (Corona 19) is prolonged, businesses whose sales have deteriorated are being asked to repay some of them from banks or are denied additional loans. An official from the bank said, “The government is telling us not to cut off loans to small business owners, but the Corona 19 crisis may end, but we cannot recklessly postpone or lend more money.” Of course, small business owners received various guarantee loans with the funds prepared by the government through the additional budget. 1st and 2nd COVID-19 loans executed over 20 trillion won are often rejected when △the procedure from application to execution is complicated, △the limit for each individual is extremely small and △low credit rating. In the midst of this, small businessmen are trembling with anxiety as credit loans, which were the’last dong-a line’, tighten. Im Mo, who runs a meat restaurant in Yeongdeungpo, Seoul, said, “I have already used all loans and credit loans for small business owners.”
The bank only excuses’can’t help it’
Banks are protesting that they cannot open more ‘sheds’ because of the government’s tightening regulations on lending. Financial authorities are closely monitoring the number of high-value credit loans of 100 million won or more for each bank. Most credit loan maturities are one year. When the maturity of credit loans received at the beginning of the year begins to return at the beginning of next year, it is expected that a large number of people suffering from the reduction of the limit will be poured out.
New loan-deposit ratio regulations and capital adequacy regulations, Basel III, which were introduced earlier this year, are also factors that raise the threshold of banks’ household loans. Banks are required to keep the monthly average balance of the deposit-to-deposit ratio (the ratio of loans to deposits) within 100%. A weight of 115% is applied to household loans, so it is inevitable to reduce the weight. A bank official said, “In April, in the early days of Corona 19, the government eased the loan-to-deposit ratio regulation to 105% in order to expand the supply of funds. Loaning is possible only when it is released,” he said.
However, it is unclear whether there will be room for household loans even if the loan-to-deposit ratio regulation is lifted. This is because of the’homework’ received from the early introduction of Basel III, a new capital soundness capital regulation. The financial authorities demanded that the banks that introduced Basel III increase the share of corporate loans to the level of 50-60%. It is known that it was delivered to the bank. An official from a commercial bank said, “The banks that introduced Basel III had the effect of improving their capital soundness, but if they were canceled midway, they couldn’t do it.” did.
The loan conditions for common people are expected to worsen next year. Financial Supervisory Commissioner Yoon Seok-heon said at a press conference on the 23rd that “the total amount of loans (to banks) will need to be regulated for the time being.” There are criticisms that various loan control measures that fail to comprehensively take into account the Corona 19 situation, repayment capacity for each borrower, and regulations on capital soundness of banks are drying the blood of ordinary people’s finances.
Reporters Jeong So-ram/Kim Dae-hoon/Oh Hyun-ah [email protected]