South Korea's Fair Trade Commission has imposed a combined fine of 272 billion won on four major banks—KB Kookmin, Shinhan, Woori, and Hana—for colluding on real estate loan-to-value (LTV) ratios. The banks exchanged information from March 2022 to March 2024 to avoid competition. This practice limited options for consumers and small businesses seeking mortgages.
South Korea's Fair Trade Commission (FTC) announced on January 21, 2026, that it has fined the country's four major commercial banks—KB Kookmin Bank, Shinhan Bank, Woori Bank, and Hana Bank—a total of 272 billion won (about $183.8 million) for colluding on loan-to-value (LTV) ratios in the real estate mortgage loan market. The LTV ratio serves as a key regulatory tool to limit household debt by capping the amount borrowers can loan based on property collateral value.
The banks exchanged detailed LTV information between 736 and 7,500 cases repeatedly from March 2022 to March 2024, coordinating their lending limits to evade competition. This reduced uncertainty in rivals' strategies, allowing stable profits and generating an estimated 6.8 trillion won in interest earnings, according to the FTC. Holding about 60% of the nation's real estate mortgage market, their uniform LTV levels restricted consumers' lender choices.
Individual fines were: Hana Bank at 87 billion won, KB Kookmin at 70 billion won, Shinhan at 63.8 billion won, and Woori at 51.5 billion won. While other banks offered LTV ratios 7.5 percentage points higher on average in 2023, the collusion made financing harder for borrowers. Small and medium-sized enterprises (SMEs), with lower credit ratings, were particularly affected, as they rely heavily on secured mortgage loans over unsecured options.
FTC senior official Lee Sun-mi stated, "Between a minimum of 736 cases and a maximum of 7,500 cases, the four major banks repeatedly exchanged detailed information on their LTV ratios over a long period whenever necessary." Senior official Moon Jae-ho added, "Borrowers had little choice but to face limited options when selecting a bank," noting the difficulty in quantifying exact damages.
This marks the first enforcement of a provision in the revised Fair Trade Act, effective December 30, 2021, banning anti-competitive information sharing. An FTC official said, "We will strengthen monitoring on such unfair information-sharing practices not just in finance, but other industrial areas. Any firms that violate the rule will be sternly punished." The case is expected to promote fair competition in banking and protect customer interests.
