(Photo = Yonhap news)

 

[Alpha Biz=(Chicago) Reporter Paul Lee] With the delinquency rate of the KFCC rising sharply this year, financial authorities will conduct their first inspection of individual safes from the 8th of next month. This is the first time that the financial authorities have inspected the Saemaul Treasury, which is managed and supervised by the Ministry of Public Administration and Security. With this inspection, it is expected that the Korea Federation of Community Credit Cooperatives, along with savings banks, will begin to clean up bad debts in earnest.

According to the financial sector and financial authorities on March 31, the Financial Supervisory Service will conduct on-site inspections of KFCCs for about two weeks from April 8 with the KFCC Central Committee. Subject to the inspection are four individual safes with relatively large assets.

The move comes after the Financial Supervisory Service, the Korea Deposit Insurance Corp. and the Korea Federation of Community Credit Cooperatives formed an inspection consultative body in accordance with the "Agreement for Strengthening the Cooperative System for the Supervision of the Soundness of Community Credit Cooperatives" signed last month by the Financial Services Commission and the Ministry of the Interior and Safety.

The financial authorities and the Ministry of the Interior and Safety will be the first to conduct such a joint inspection after accepting the idea of expanding the role of financial authorities in the process of supervising the vault since the Korea Federation of Community Credit Cooperative's bank-run crisis in July last year.

In particular, KFCC's delinquency rate has soared this year amid the aftermath of the real estate project financing (PF) crisis, raising tensions. The delinquency rate of KFCC rose to 5.07% as of the end of last year, to 6% as of January this year, and further increased to 7% last month.

 

 

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