The Korea Herald

FSC to slash private loan interest rates

Jul 8, 2015

The regulator plans to slash the maximum interest rate that nonbanking lenders can charge. The Financial Services Commission recently investigated several private lenders, to find that their borrowing rate policies were all high, and did not reflect the central bank’s recent rate cuts. On June 11, the Bank of Korea lowered the base interest rate to a record low of 1.5 percent, following the economic losses due to the outbreak of the Middle East respiratory syndrome and weak yen. This was the fou
Seoul shares hit near 4-month low on Greek, Chinese woes

Jul 8, 2015

South Korean stocks plunged 1.18 percent to a near four-month low Wednesday as uncertainties about the future of the eurozone and the slowing Chinese economy sapped investor sentiment here, analysts said. The Korean won declined sharply against the U.S. dollar.The benchmark Korea Composite Stock Price Index lost 24.08 points to close at 2,016.21, marking the lowest since March 16. Trading volume was heavy at 444.1 million shares worth 7.44 trillion won ($6.55 billion), with decliners beating gai
S. Korea tracks U.S. rate moves with 10-month time lag: report

Jul 8, 2015

South Korea's monetary policy usually moves in tandem with that of the U.S. after an average 10-month time lag, a report showed Wednesday, as market watchers are keeping eyes on the time frame of a much-awaited rate hike in the world's largest economy.The report, compiled by Woori Finance Research Institute, showed that since May 1999, South Korea's interest rate hikes and reductions have come some 10 months after the U.S. Federal Reserve's rate decision.The study, however, showed that South Kor
Won falls to almost year-low on Greek, Fed rate woes

Jul 7, 2015

The U.S. dollar approached its strongest level of the year against the Korean won Tuesday over aggravated uncertainty due to Greek woes.After gaining Monday, the greenback further climbed Tuesday to close at 1,130.2 won, up 3.7 won from the trading session before. This marked its highest since it peaked at 1,131.5 won on March 16. Should the rate break through the year-high of 1,131.5 won, the next barrier will be 1,135.5 won, which was last posted two years ago.After diving to below 1,010 won o
Household debt hits record high in May

Jul 7, 2015

South Korea’s household debt hit a record high in May, although its monthly growth rate has slowed considerably due to a sharp drop in household bank loans, the central bank reported Tuesday. According to Bank of Korea data, the nation’s total household debt rose to 768.2 trillion won ($679.2 billion) as of the end of May, up 2.9 trillion won. The figure increased for 16 consecutive months since January of last year, when the amount decreased by 2 trillion won. Of the 2.9 trillion won rise in bo
Finance minister urges quick approval of extra budget

Jul 7, 2015

Lawmakers should lose no time in passing a supplementary budget aimed at kick-starting the economy struggling with the fallout from the Middle East Respiratory Syndrome outbreak and slowing exports, the finance minister said Tuesday.The government on Monday submitted an 11.8 trillion won ($10.4 billion) extra budget bill to the National Assembly for approval, which is part of a larger 22 trillion won stimulus program designed to cope with the impact of MERS and breathe new life into anemic consu
Seoul shares fall 0.66 pct on losses in pharmaceuticals, cosmetics

Jul 7, 2015

South Korean stocks sank 0.66 percent Tuesday as investors dumped pharmaceutical and cosmetics shares on gloomy earnings outlooks, analysts said. The local currency lost ground against the U.S. greenback.The benchmark Korea Composite Stock Price Indexlost 13.64 points to close at 2,040.29. Trading volume was moderate at 494.2 million shares worth 8.2 trillion won ($7.3 billion) with decliners outnumbering gainers 453 to 368."Pharmaceutical and cosmetics firms had been on a roll to lead the recen
Won-dollar rate draws near yearly high

Jul 7, 2015

The U.S. dollar approached the strongest level of the year versus the Korean won Tuesday over aggravated uncertainty due to Greek woes.Following its gain Monday, the greenback further climbed Tuesday to close at 1,130.2 won, up 3.7 won from a trading session before. This marked its highest since it peaked at 1,131.5 won on March 16. Should the rate break through the year-high of 1,131.5 won, it -- as a second phase -- could come close to 1,135.5 won, which was last posted two years ago.After tak
Greek vote dents Korean won, stocks

Jul 6, 2015

South Korea’s financial market, like other emerging countries, was hit by Greek citizens’ rejection of a new bailout deal through a referendum over the weekend.Foreign investors dumped local shares and the Korean won lost ground against major currencies such as the U.S. dollar and the Japanese yen amid the growing preference for safe assets.The benchmark KOSPI dropped by 50.48 points, or 2.4 percent, from the previous trading session to close at 2,053.93. Foreign currency dealers are seen at th
KOSPI gains rank 10th among G20 nations in first half

Jul 6, 2015

Korea’s benchmark stock price index recorded the 10th biggest gain among the Group of 20 economies in the first half, up nine notches in six months, the Korea Exchange revealed Monday. The Korea Composite Stock Price Index grew 8.3 percent to 1,293 trillion won ($1.15 trillion) in the January-June period this year, slightly below the G20’s average 8.7 percent. At the end of 2014, the KOSPI had marked negative growth of 4.8 percent, ranking 19th among the G20 economies in gains. With Korea elevat
Gov't tables extra budget bill in parliament

Jul 6, 2015

The government on Monday submitted a supplementary budget bill to the National Assembly for approval as part of efforts to revitalize the economy struggling with slumping exports and anemic domestic demand.The 11.8 trillion-won ($10.49 billion) extra budget is part of a 22 trillion-won stimulus package the government says will help revitalize the economy while also providing much needed financial resources to battle the Middle East Respiratory Syndrome outbreak.It comes in addition to the govern
S. Korea drawing up contingency plan against potential Grexit

Jul 6, 2015

South Korea is working on contingency measures against possible increased volatility in financial markets as Greek people have turned down international creditors' austerity measures in a high-profile referendum, a high-ranking official said Monday.On Sunday, more than 60 percent of Greek voters rejected tough bailout terms, triggering concerns over a "Grexit" from the eurozone."We are working on a contingency plan as the likelihood of a Grexit has been bolstered, which would have a considerable
Mortgage growth hits 5-year high

Jul 5, 2015

The monthly increase of outstanding mortgages rose to its fastest pace in five years last month amid record-low interest rates, after the Bank of Korea cut its key rate to 1.75 percent on June 11.Korea’s seven largest commercial banks’ collective housing-collateralized loans swelled by 9.27 trillion won ($8.27 billion) in June, compared to the previous month. The figure included loans that borrowers converted into state-led, lower-rate contracts.The May-June 2015 period saw the highest monthly g
Major banks in full-fledged restructuring

Jul 5, 2015

Major commercial banks are scaling back payrolls and closing down uncompetitive branches in the wake of weakening profits brought by low interest rates. While the industry’s full-scale restructuring is considered an inevitable measure to improve its manpower structure, concerns have also been raised over the possibility that it may reduce the quality of the nation’s financial services.KB Kookmin Bank led spearheaded the move by accepting the voluntary redundancies of 1,121 employees in June.“Vol
Housing loan growth hits 5-year high

Jul 5, 2015

The monthly increase of outstanding mortgages rose to its highest point in five years last month amid record low interest rates.The Bank of Korea cut its key rate to a new record low of 1.75 percent on June 11.According to Korea’s seven largest banks, their collective housing-collateralized loans swelled by 9.27 trillion won ($8.27 billion) in June, compared to the previous month. The figure included borrowers’ conversion of their lending into state-led lower rate contracts.Based on month-on-mon