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[Alpha Biz=(Chicago) Reporter Paul Lee] Authorities have convened 10 securities firms in Korea as concerns over real estate PF (project financing) have grown due to a recent series of incidents, including the Korean Federation of Community Credit Cooperatives crisis and the increased risk of losing overseas real estate funds.
The PF delinquency rate of securities firms is the highest among all financial institutions, and the outstanding balance has nearly doubled compared to the end of last year, raising concerns. The Financial Supervisory Service warned that PF loans, which are feared to be insolvent, should be quickly sorted out and enough loss absorption capacity should be secured. It also ordered countermeasures to minimize the possibility of investor damage.
Hwang Sun-oh, vice president of financial investment at the Financial Supervisory Service, called in executives in charge of 10 CROs and IBs (corporate finance) at the Financial Supervisory Service on the 20th to hold a meeting to strengthen risk management of real estate exposure (risk exposure).
Vice President Hwang Sun-oh pointed out, "While the delinquency rate of PF loans by securities firms has been on the rise since the second half of last year, there have been repeated problems of investment losses related to overseas real estate." Deputy Director Hwang said, "We will intensively manage securities firms with weak risk management by submitting separate management measures and conducting individual interviews with CEOs (CEOs)."
The meeting was attended by Mirae Asset Securities, Meritz, Hana, Korea Investment, Samsung, Daishin, Hi Investment, Hyundai Motor, BNK Investment, Daol Investment & Securities CRO and IB·PF headquarters.
AlphaBIZ 폴 리(hoondork1977@alphabiz.co.kr)
