President Lee Jae Myung on Tuesday slammed a bad bank in South Korea for their "predatory" act of collecting borrowers' debts that are long overdue.
Quoting a news report about a low-income earner's struggle in repaying debts and interests to a South Korean bad bank named "Sangnoksu" on his X account, Lee said that the institution had crossed the line by failing to participate in the government-led debt relief program.
Instead, the bad bank, jointly owned by South Korean banks and credit card companies to handle nonperforming loans in the wake of a massive credit card crisis in early 2000s, was sticking to its debt collection scheme against households who have been indebted for decades.
"I did not know that such a primitive form of predatory finance was blatantly surviving and piling pressure on the lives of ordinary people," Lee said in his X post on Tuesday.
"There is a line not to cross in corporate profit-making," Lee added, describing troubled debtors as "neighbors in our community with whom we must live together."
During a Cabinet meeting later Tuesday, Lee criticized the financial institutions that were "very diligently" collecting people's delinquent debts.
The liberal president also highlighted that these institutions were subsidized in times of crisis, while its shareholders have been enjoying a high level of dividend from the bad bank.
In this regard, Lee urged the financial authorities to seek ways to salvage indebted borrowers.
This came about a week after Lee's chief secretary for policy Kim Yong-beom claimed on Facebook that he and the president had reached common ground in that South Korea's credit scoring system must undergo a structural overhaul. Kim said that the system ― those who are capable of repaying debts get higher scores ― marginalizes those who are worse-off.
Lee in the Cabinet meeting also invoked the latest legislation that removed the financial obligations of those who had borrowed from loan sharks.
"If a lender is asking for 60 percent interest on a loan, you don't have to even pay back the principal," Lee said Tuesday.
consnow@heraldcorp.com
