South Korea's financial authorities on Monday vowed to make all-out efforts to stabilize the market under strain from increased uncertainties at home and abroad.
In a joint emergency meeting, the two state regulatory agencies -- the Financial Services Commission (FSC) and the Financial Supervisory Service (FSS) -- agreed to push for an "aggressive response" to a host of challenges.
Many predict speedy market interest rate hikes due to the incoming U.S. President Donald Trump's fiscal expansionary policy.
In South Korea, political uncertainties linger on especially in the wake of the National Assembly's impeachment of President Park Geun-hye. Her presidential fate will be decided by the Constitutional Court in several months.
The FSC and the FSS cited massive household debt as the main problem. Household credit in Asia's fourth-biggest economy has exceeded 1,300 trillion won ($1,100 billion).
They announced plans to raise the target ratio of fixed interest rate loans from 42.5 percent to 45 percent for 2017. That of installment debt payment will be also lifted to 50 percent from 45 percent.
"We should accelerate improvement in the quality of household debt, which has grown still at a fast pace," the FSC's chairman Yim Jong-yong said.
Yim, tapped as the nation's new finance minister, also emphasized the importance of enhancing the foreign exchange soundness of local banks and other financial institutions.
He urged all related private institutions to share the burden of measures to reduce the systemic risks of the financial market.
There should be no "free ride" by any financial company, Yim added. (Yonhap)
