Regulatory Alerts2024-06-25 | 82528FSC Announces Plans for Implementing Stressed Debt Service Ratio Rules in H2 2024
The Financial Services Commission postponed the second phase of stressed debt service ratio rules to September 1, 2024, to facilitate a soft landing for lower-income households and self-employed business owners. The updated regulations impose a 0.75 percent additional stress rate on banking credit loans exceeding KRW100 million and nonbanking home-backed mortgages, potentially reducing maximum loan limits by 3 to 9 percent for mortgage borrowers. Authorities expect these measures to improve the qualitative structure of household debt long-term while maintaining stable loan limits for approximately 90 percent of current borrowers.
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