Weekly e-Briefing 12. Regulation on Banks’ Loan-to-Deposit Ratios

Regulation on Banks’ Loan-to-Deposit Ratios


Throughout the financial crisis, one of the very critical points the Korean government had to accept from the global financial market was liquidity.  Starting from January 2014, Korean banks with Korean won-denominated loans over 2 trillion won will be applied by new amendments so that they have to maintain loan-to-deposit ratios within 100%. Both domestic and foreign banks.  Amongst foreign banks, there is only one foreign bank that will be applied by the new amendments, which is HSBC whose Korean won-denominated loans are in excess of 3.3 trillion won at the end of last year. Amongst special purpose banks, the National Agricultural Cooperative Federation is only one special purpose bank that will be applied by the new amendments.  Starting from 2014, the banks will be applied by the new amendments. Comply with the global standard. So the FSC together with the FSS will closely monitor improvements after 2014 such as how they comply with our new amendments and we will take appropriate action on that.  Please visit http://www.fsc.go.kr/eng/index.jsp for more details.

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About FSC Korea
The Financial Services Commission has been established for the purpose of protecting the integration of Korea’s financial markets by promoting sound credit system and fair business practices. To this end, the FSC serves as a consolidated policy making body for all matters pertaining to supervision of the financial industry as a whole. To raise the efficiency, the posts of the FSC Chairman and the FSS Governor were separated on March 2008 for clear distinction between policy-making and execution of financial market supervision

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