[THE INVESTOR] Korea’s top financial regulator vowed on June 29 to act preemptively to minimize any market fallout in the wake of Britain’s vote to leave the European Union .

As Brexit may have a lingering and lasting impact on global markets in the long term, Korea will take quick and bold steps to ease any post-Brexit market turmoil while thoroughly preparing to ride out the changes ahead, Financial Services Commission chairman Yim Jong-yong told lawmakers.

“Market volatility has eased this week. But uncertainties still remain high out there as Britain’s exit from the EU is the first of such kind,” he said.

He said the government will apply stricter rules from next month on home loans as there are some signs of “overheating” in the property market.

Until recently, those who signed up to buy an apartment under construction have used the collective middle payment system to borrow a chunk of money from lenders under the guarantee of the Korea Housing & Urban Guarantee Corporation. The initial and final payments are usually made by the apartment buyers’ own money.

From July, the KHUG will offer its debt payment guarantee for apartment buyers with a maximum of 600 million won (US$516,000) per person.

There has been no upper limit for the guarantee so far, the FSC said.

Helped by record-low rates and the government’s stimulus programs to boost the real estate markets, household loans have already exceeded 1,200 trillion won, raising worries that they could strike a major blow to Asia’s fourth-largest economy if rates turn higher.

(theinvestor@heraldcorp.com)