State-run asset management company to ensure that National Happiness Fund is well managed
Chairman Chang Young-chul of Korea Asset Management Corp.,
right, is with Prime Minister Chung Hong-won, left, at the office
of the National Happpiness Fund to show the window
where the applications for the fund are accepted recently.
Chairman and CEO Chang Young-chul of Korea Asset Management Corp. (KAMCO) said KAMCO will buy 3.1 trillion won worth of defaulted assets this year, including 1.1 trillion won worth from the banking sector and 2 trillion won worth from the public sector.
KAMCO will not only take over the defaulted assets, but also provide financial consultations to companies with debt problems to help them restore their financial creditability by restructuring their debts.
KAMCO will buy defaulted assets of general borrowers that lender banks own worth 1.1 trillion won, including houses put up against loans, in line with its operation plans approved by the financial authorities, and promote a model project to help the poor with 100 billion won worth of its own funds. KAMCO also will take over 2 trillion won worth of public sector defaulted assets owned by government policy financial institutions.
KAMCO will also take charge of project financing in default owned by savings banks, which amounts to 2.3 trillion won over 176 cases. KAMCO will sell off those assets after the self-survival periods for savings banks to resolve their rights over the projects expire. But the company will try to normalize or sell the projects that are being taken over by private real estate developers or savings banks and those that related parties have agreed to sell.
KAMCO will do its best to ensure that the National Happiness Fund is managed well enough to satisfy the purposes of the establishment of the fund, which is to help the economically less fortunate.
The company plans to streamline its personnel and strengthen the financial infrastructure for the less well-off people to upgrade their standard of living, Chang said.
He said KAMCO will take measures to help the Happiness Fund’s operations take root early and ensure its effective management as soon as possible by assigning personnel with enough experience in managing support measures for the recovery of the financial creditability of the less fortunate and by increasing KAMCO’s takeover of the defaulted assets of those people to ease their burden.
KAMCO will expand its takeover of the defaulted assets from 4,100 financial institutions or companies that hold the credit support agreements with KAMCO to rearrange debts. The number of defaulters on the KAMCO takeover list will total 595,000 and they will also take over 2.11 million defaulters from the Asset Management Corp. (AMC) to provide support for the debt readjustment for 320,000 defaulters in five years.
For six months from this month, KAMCO will also ease the terms and conditions for replacement loans for those with loans with excessively high interest rates. The limit per person to take out replacement loans will be raised from 30 million won to 40 million won and the annual income limit will be expanded to less than 40 million won from 26 million won.
KAMCO projects the high interest rates of 35.5 percent per annum will be cut by 25 percent per annum to 10.5 percent per annum.
Chairman Chang said KAMCO will provide financial support for those who repay their debts such as replacement loans for those who manage to regain financial trust though court managed personal financial credit recovery measures so that they can stabilize their livelihoods. The company will give 60 billion won for up to 13,000 of those who repay their loans with sincerity.