South Korea's public financial service firms will aggressively write off nonperforming loans extended to low-income people in a bid to facilitate their debt rescheduling, a public agency said Monday.
The decision came at a meeting of the nation's regulators and the heads of such organizations as Korea Housing Finance Corp. and Korea Asset Management Corp.
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South Korea's financial regulators meet with the head of the nation's public financial firms in Seoul on March 6, 2017. (Yonhap) |
KHFC, KAMCO and four other public financial companies had 24.9 trillion won ($21.5 billion) in bad debts held by around 718,000 individuals as of the end of last year.
Banks usually write off the debts of individuals who are delinquent for about a year. But public firms tend to possess such loans for 3-10 years, making it hard to reschedule debt for people who regularly struggle to pay back their dues.
"Nonperforming loans should be handled swiftly, rather than being held for a long time," the FSC's Vice Chairman Jeong Eun-bo said during the meeting.
He stressed that public firms need to write off bad debts in a "bold" manner to raise the effectiveness of their asset management. (Yonhap)
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