Seoul: Over 60 percent of loans extended to risky real estate development projects had been restructured through June via sell-offs or recapitalization, the financial watchdog said Thursday.
According to Yonhap News Agency, the Financial Supervisory Service (FSS) reported that 12.7 trillion won out of 20.8 trillion won (US$14.9 billion) extended in loans to risky real estate project financing (PF) had been restructured as of end-June. The end-June tally slightly surpasses the watchdog's earlier target of 12.6 trillion won.
Financial institutions' exposure to real estate development stood at 186.6 trillion won at the end of June, down 4.1 trillion won from three months earlier. The remaining risky PF loans will be restructured without any problem, the watchdog said.
PF loans have been one of the sticky issues in the financial market as a rise in soured loans, which started in late 2023, was feared to hurt financial institutions and the overall financial stability in the market.