원리금 연소득 70% 넘으면 '위험대출'…대출 어려워진다<br /><br />The country's household debt is estimated to have reached around 1-point-3 trillion U.S. dollars.<br />To fight this trend, the government announced stricter loan screening rules for banks.<br />Ko Roon-hee explains how the changes would work. <br /> South Korea's Financial Services Commission and Financial Supervisory Service announced on Thursday that they are creating a specific standard, based on the debt-service ratio, for what is classed as a risky bank loan.<br />Vice Chairman of the FSC Kim Yong-beom said this change, which will come into effect at the end of the month, will help lower the rate of household debt growth. <br />"Although household debt problems are less likely to spread to systemic risks, the absolute size is large and the growth rate is fast. Credit management measures such as the debt-service ratio and rent-interest ratio should be implemented to further slow down debt growth." <br /> The debt service ratio, or DSR, is calculated by dividing a borrowers' annual income by their annual debt repayments including interest.<br />A high DSR is negative from the bank's point of view. <br />Since March this year, banks have applied their own debt-service ratio standards to almost all household loans on a pilot basis. <br />Each bank had a different definition of a risky borrowing... but their average definition of a high DSR was 100%.<br />According to the FSC's new announcement, loans with DSRs exceeding 70% will now be categorized as a high DSR... and banks should limit these to 15% of new loans. <br />And only 10 percent of new loans will be allowed to have a DSR above 90%.<br />Commercial, regional and specialized banks will have different limitations. <br /> The Financial Supervisory Service is expected to check if banks are following these measures on a monthly basis. <br /><br /> Meanwhile, the government aims to reduce the average DSR of commercial banks to 40% by the end of 2021...which is around 10-percent lower than their average DSR last June.<br />Ko Roon-hee, Arirang News. <br />
