NongHyup Bank Temporarily Restricts MCI Enrollment for Seoul Metropolitan Area Mortgages... Strengthens Household Loan Management

Applies to Mortgage Loans in Seoul, Gyeonggi, and Incheon
Loan Limits Reduced by 48 to 55 Million Won

NH NongHyup Bank will temporarily restrict enrollment in mortgage credit insurance (MCI) for home mortgage loans in the Seoul metropolitan area. This move is interpreted as the bank proactively implementing its own mortgage loan regulations, following the financial authorities’ enhanced management of household loan growth rates.

According to the financial sector on May 4, NongHyup Bank plans to temporarily suspend MCI enrollment for mortgage loans on properties located in the Seoul metropolitan area (Seoul, Gyeonggi, and Incheon) starting from May 6. Mortgage loan applications that are submitted, reviewed, and approved before May 6 will not be affected, but those applied for after May 6 will be subject to the new restriction.

MCI, issued by SGI Seoul Guarantee, is insurance that is taken out simultaneously with a mortgage loan. Without this insurance, borrowers can only receive a loan for the amount remaining after deducting the small deposit for tenants, thereby reducing the maximum loan amount.

It is reported that the mortgage loan limit will be reduced by approximately 55 million won for apartments in Seoul and by around 48 million won for those in Gyeonggi Province.

However, there are currently no plans to restrict enrollment in mortgage credit guarantees (MCG) issued by the Korea Housing Finance Corporation.

An official from NongHyup Bank explained, “We are implementing the suspension of MCI enrollment to ensure stable management of household lending.”

According to the household debt management plan announced by the Financial Services Commission on May 1, the household loan growth rate for the five major commercial banks (KB Kookmin, Shinhan, Hana, Woori, and NH NongHyup Bank) will be capped at around 1%. In particular, separate target values for mortgage loans will be assigned to each bank.

This content was produced with the assistance of AI translation services.