SEOUL—The Financial Supervisory Service (FSS) of South Korea has pledged to implement measures to prevent the spillover of real estate project financing (PF) risks into the broader financial markets, as stated by the FSS governor Lee Bok-hyun on Monday. Lee emphasized the importance of persuading financial institutions to proactively manage credit risks associated with real estate PF loans, describing these risks as a potential "detonator" for the South Korean economy.
According to Yonhap News Agency, the regulator is focused on encouraging financial companies to enhance their loss-absorption capacities in relation to PF loans. Lee also issued a warning regarding severe consequences for financial institutions that fail to adequately address risks or neglect their responsibilities. This announcement comes in the wake of increased concerns over real estate project financing, particularly after the significant builder Taeyoung Engineering and Construction Co. applied for a debt restructuring program late last year. The FSS highlighted a concerning rise in the delinquency rate on PF loans, which more than doubled to 2.42 percent by the end of September, up from 1.19 percent at the end of 2022.
SEOUL—The South Korean stock market experienced a significant downturn in late Monday morning trading, as investors began selling off shares to capitalize on recent gains. The Korea Composite Stock Price Index (KOSPI) saw a decline of 38.63 points, dropping 1.48 percent to 2,576.68 by 11:20 a.m. Leading the downturn were major chipmakers, with Samsung Electronics, the world's largest semiconductor manufacturer, falling 1.73 percent and SK hynix, its competitor, decreasing by 0.96 percent.According to Yonhap News Agency, other key industry players also saw declines in their share prices. Kia, the nation's second-largest automaker, dropped 1.92 percent, while its affiliate Hyundai Mobis decreased by 1.51 percent. Furthermore, leading battery manufacturer Samsung SDI saw a 1.02 percent fall, and SK Innovation, the top oil refiner, experienced a 1.53 percent reduction in its share price. Concurrently, the South Korean won depreciated against the U.S. dollar, trading at 1,337.1 won, a decline of 14.5 won from the previous session's close.
SEOUL—The Seoul city government announced on Monday a detailed development plan for transforming an abandoned train maintenance depot in the Yongsan district into a pioneering urban space. The plan includes the construction of a 100-story skyscraper and a unique sky trail linking high-rise buildings, among other innovative features. This initiative aims to convert the 500,000-square-meter site into the world's largest "vertical city," incorporating extensive green spaces from the basement to the rooftops.According to Yonhap News Agency, the Yongsan International Business District blueprint is set to kickstart infrastructure construction in the second half of 2025, with businesses expected to move in by the early 2030s. This ambitious project, situated near the former USFK compound and the Han River, is designed to be about 4.4 times the size of Hudson Yards in New York, representing the last significant undeveloped land parcel in Seoul.
Originally announced in 2006, the project faced delays primarily due to the 2008 global financial crisis. The renewed plan envisions a compact city where business, residential, and leisure spaces are within walking distance. The international business zone will host a skyscraper with around 100 floors, alongside Class A office buildings, hotels, and a metropolitan transit center, featuring observation and amusement facilities. The business complex zone will include corporate facilities connected by a sky trail, while the business support zone will focus on housing, education, and cultural facilities, including a concert hall, an art museum, and a library, collectively known as the Seoul Art Band.
Furthermore, the project aims to enhance its green space ratio by integrating with the surrounding Han River and Yongsan Park areas, signifying a significant step towards urban regeneration and sustainability.