Woori Financial Group, as a follow-up measure after the meeting of the chairmen of major financial holding companies on Aug. 21, has decided to resolve the household debt crisis, expand loans to SMEs and the financially poor as well as promote exports and investments in support of the real economy to secure stability and health of the financial market to cope with changes in the financial environment both at home and abroad and to play its role as a social safety net by stepping up those measures as instructed by Chairman Lee Pal-seung.

In particular, Chairman Lee told the financial group to introduce a tailor-made financial product for the first time in the financial industry based on the ‘sale and lease back’  idea for one-house owners who have trouble paying back bank their loans.

The product is designed for one-house owners to put their ownership rights of houses into trust accounts at banks allowing banks to free them from debt obligations and continue to reside in those houses by paying rent.

Woori Bank will introduce the product from next month and other affiliate banks including Kwangju Bank and Kyungnam Bank will follow later. The bank has scrapped fees for credit checks, lowered the ceiling for household loans to 14 percent from 17 percent per annum and will also cut the maximum mortgage loan amount to 110 percent from 120 percent.

The group has also decided to expand loans to financially poor individuals due to the widening wealth gap in the country. The group has already instructed its affiliate banks and other affiliate financial institutions.

The group has decided to offer small loans at the maximum annual interest rate of 10 percent or below on credit and special loans to ‘our youth and college students who suffer from excessive interest rates on loans,’  so that they can replace their loans with low-interest loans. The group has also decided to offer special fund loans to small and medium-sized supermarkets as part of its diverse efforts to support small businesses. The group will also offer loans to poor families at an interest rate of only 7 percent per annum from September.

Woori Bank will provide various consultation services for SME clients at their jobsites as a true partner for mutual survival.

President Lee Soon-woo of Woori Bank said he will manage the bank to act like a doctor who makes preemptive medical prognoses of patients to prevent disease by taking care of its corporate customers, especially SMEs, before they are hit with managerial dangers in these difficult times when the world economy has been suffering from the impact of the European debt crisis.

“Our bank should be like a doctor who can take care of his patients before they get sick by correctly diagnosing the disease by analyzing various symptoms and prescribing the right medicine,” said the CEO.

He said the prolonged European debt crisis has had a huge impact on the Korean economy, especially its exports, and preemptive actions have to be taken to help those SMEs now more than at any time before.

Woori Bank signed consultation agreements early in the year with the Small and Medium Business Industrial Corp. and the Credit Guarantee Foundation and introduced the Our Youths Exclusive Seed Money Loans. In July, the bank signed an agreement to provide 30 billion won to the Regional Credit Guarantee Foundation to expand the bank’ s financial support to SMEs.

The CEO said what’ s good for SMEs now are not just low-interest loans, but consultations to see where they stand in their operations and to provide loans where they are needed the most.

He said the bank has experience providing managerial consultations to SMEs since 2001 when it launched business consultations for its corporate customers for the first time.