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| Financial Supervisory Service (FSS) Governor Lee Bok-hyun speaks during a joint meeting with leaders of listed companies as well as the Korea Exchange (KRX) in Seoul, Wednesday. Yonhap |
5.39 tril. won solar energy loans approved during Moon administration to be examined
By Anna J. Park
The Financial Supervisory Service (FSS) has started looking into allegations of bad loans related to solar energy development during the former President Moon Jae-in administration.
The FSS said Wednesday it is planning to look into banks' detailed records regarding their approved loans related to solar energy development since 2017.
The FSS' move comes as the anti-corruption bureau of the Office of Government Policy Coordination announced earlier this month that it identified numerous cases of illegal or problematic government-funded solar energy projects during the Moon administration in 12 local governments nationwide.
Currently, the FSS is compiling information about solar energy loans made during the past administration.
"First of all, the FSS is receiving reports from financial companies on information about solar energy-related loans, as there had been a wide variety of loan products ranging from state-funded to general loans," an FSS official said.
Financial Services Commission (FSC) Chairman Kim Joo-hyun also said during a meeting at the National Assembly earlier this week that the FSC will work closely with the FSS on the inspection.
According to documents submitted by the FSS to Rep. Yun Chang-hyun of the ruling People Power Party, loans worth a total of 5.39 trillion won ($4 billion) were approved during the five years of the previous administration for solar energy development businesses. KB Kookmin Bank approved the largest amount of loans worth an aggregated 1.73 trillion won, followed by Jeonbuk Bank with 1.48 trillion won.
Twenty-seven percent of the aggregated amount of loans approved during the Moon administration, or 1.49 trillion won, were found to be exceeding collateral value, with Jeonbuk Bank taking up the largest portion of such loans at 477 billion won.
Financial authorities say they plan to look closely into how collateral values were estimated and how such loan repayment plans were devised.
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