The launch of a mortgage loan product that Toss Bank had planned to roll out in the first half of this year has been pushed to the second half. Toss Bank said it is "considering an innovative mortgage loan product structure that did not exist before," but observers say a launch in the second half may also be difficult under the government's strong lending curbs.
According to the financial sector on the 9th, Toss Bank has not yet even applied to the financial authorities for a review of the mortgage loan product terms. Toss Bank has pledged since last year to launch the mortgage loan in the first half of this year. The terms review is a step required before launching a new financial product. The review process typically takes about one to two months.
For now, the government plans to maintain strong lending curbs, except for some genuine demand such as young people and newlyweds. Lee Eog-weon, chair of the Financial Services Commission (FSC), said on the 27th last month, "When supply is insufficient and market liquidity is overflowing, even a slight easing of loans stimulates the dwellings market again and creates a vicious cycle of rising prices. Household loans or real estate loans must be consistently stringent."
The increase in household loans is another variable. The amount of household lending that Toss Bank can grow this year is 505.2 billion won, but 178.5 billion won increased in the first quarter alone, exhausting 35% of the target. If the cumulative increase in household loans in the second quarter approaches or exceeds the target, the likelihood of launching the mortgage loan could fall further. Toss Bank plans to disclose the cumulative outstanding loan balance for household loans in the second quarter at the end of this month when it announces earnings.
Toss Bank needs to launch a mortgage loan with solid collateral to manage asset quality. As of the end of the first quarter, household loans accounted for 14.1315 trillion won out of Toss Bank's total credit of 15.5047 trillion won, or 91%. Of this, more than 60% are unsecured loans without collateral. Based on the end-of-first-quarter balance, the share of loans to mid- to low-credit borrowers was 34.75%, the highest among the three internet-only banks.
A Toss Bank official said, "We are proceeding normally with product design and IT system development with the goal of launching the mortgage loan in the second half."