[Start Economy] Samsung Crisis Theory Growing... Lee Jae-yong's Eyes on 'Second Anniversary of inauguration'

■ Host: Anchor Lee Jung-seop, Anchor Cho Ye-jin
■ Starring: Professor Chae Sang-mi, Department of Business Administration at Ewha Womans University

* The text below may differ from the actual broadcast content, so please check the broadcast for more accurate information. Please specify [YTN News START] when quoting.

[Anchor]
We give you the latest economic news quickly and kindly. Start Economy, today with Chae Sang-mi, a professor of business administration at Ewha Womans University. Please come in. Recently, I've heard a lot about Samsung. It is said that there is a crisis theory, but in what background does this talk come out?

[CHAE SANGMI]
Samsung is also saying that there is a crisis theory inside. Recently, AI has received a lot of attention and the industry is growing significantly, which is why Samsung is underperforming in AI semiconductors compared to TSMC. So, in the case of TSMC, sales in the third quarter are significantly higher than expected and are receiving good reviews, but Samsung Electronics' expected sales could be reversed.

[Anchor]
Specifically, how serious is the sales?

[CHAE SANGMI]
In the case of Samsung, Samsung expects about 28.6 trillion won last time, compared to TSMC's sales of 32.3 trillion won in the third quarter. That's why I think it's going to turn the tables compared to this. This concern is being seriously seen because of the assessment that semiconductors have lost international competitiveness despite being a very important industry with Samsung Electronics as the leader in Korea.

[Anchor]
Rather, if you look at the graph, it seems like Samsung Electronics is chasing TSMC. Some say that the semiconductor sector is winter in the market now, but there are companies that are performing well in the end. Nvidia and SK Hynix. But where is the reason why Samsung is the only one who is reeling?

[CHAE SANGMI]
Recently, the AI memory market is growing explosively. However, there is a point that Samsung Electronics is not able to stand out here. In terms of innovative products such as high-bandwidth memory and HBM, SK Hynix dominated the market faster in Korea. Then, if AI continues to grow and attract attention, demand for products related to high-performance data processing will increase rapidly. However, since Samsung Electronics has yet to produce significant results in this field, I think it is necessary to continue to expand its market share in AI memory and well-performing system semiconductor technology and provide innovative solutions quickly.

[Anchor]
I don't think the stock price is using up right now. There was once a saying that Samsung would go to 100,000 electronics, but now I look at it, it's around 50,000 won. What are the possibilities, methods, and solutions for a rebound?

[CHAE SANGMI]
It's a very difficult part to see that this could rebound right away. In relation to this, it will be very important to close the gap quickly in TSMC or global markets. For this, we need to pursue strategic change, but it is necessary to quickly innovate technology in AI-related high-performance computing and AI memory products. Next, we need to quickly increase technological maturity in products such as HBM. Next, there is an innovative method such as GA in the foundry industry. Based on these next-generation technologies, it will be necessary to quickly secure major customers, expand more innovative technologies in the non-memory semiconductor sector, and make use of its strengths as a comprehensive semiconductor company.

[Anchor]
Investors seem to have a thirst for a supply contract or a new contract. And this Sunday is the second anniversary of Chairman Lee Jae-yong's inauguration, and he is Vice Chairman Jeon Hyun-young and DS division head. You issued an apology. What's your position?

[Chae Sang-mi]
It's the second anniversary of Chairman Lee Jae-yong's inauguration, and it will be necessary to make this position clear that we look forward to leadership and management performance in the future. Because if you don't accurately reveal your vision and careful goals, strategies, and management goals in the future as the chairman, in fact, this apology won't reach investors much. By clarifying a clear position in this regard, I think we will announce this position so that not only investors but also domestic officials will have more trust in Samsung in the future.

[Anchor]
We'll see how Samsung will get through this crisis and whether it can get through it. Let's move on to the next topic. The Monetary Policy Board in October lowered the benchmark interest rate. I lowered the base rate, but the loan rate is going up again. What's the reason for this?

[CHAE SANGMI]
Even if the base rate is cut, there is a slight time difference in reflecting this in the market. That's why there's such a problem.
And then the COFIX rate, which we're looking at now based on the floating rate, continues to change. It's going up. So as a result, the loan interest rate also seems to rise. In addition, the important thing is that household debt continues to rise. So there is also the position of the government authorities that need to manage this well. Then, since banks also have to manage risks, raising lending rates by raising additional interest rates seems to be playing a role.

[Anchor]
As for the loan interest rate, the bank talks about the time difference, but for customers who use the bank, their deposit interest rates are going down and high-interest products are disappearing. Because of this, in the end, the difference in interest rates on loans and deposits will increase, leading to criticism of interest business.

[Sangmi Chae] It's
right. So, the profit on deposit and loan will inevitably rise soon, and banks will raise additional interest rates and loan interest rates, so profits will increase as a result. It's like, this is inevitable sooner or later because household loans are so large that you have to manage these problems and then in terms of managing these risks, banks can't easily lower interest rates quickly.

[Anchor]
The interest rate on loans is rising and the amount of jeonse loans itself is very large. In the meantime, the government is now considering reviewing the landlord's ability to return loans when receiving jeonse loans to prevent jeonse fraud and can-be-rental loans. What do you think about the effectiveness of the measures?

[CHAE SANGMI]
If you look at the lease on a deposit basis loan structure in Korea, the tenant borrows money, but these benefits actually have a unique structure. So, during the loan process, credit evaluation or repayment capabilities for landlords who enjoy this benefit have not been reviewed, so as a result, there is an analysis that can be a deposit. Therefore, we are discussing this method of comprehensively reviewing the lessor's repayment ability and accident history through a credit rating system. If you look at this, an increase in jeonse loans helps stabilize housing for ordinary people in the short term, but in the very long run, it is recognized as a major factor in raising housing prices as jeonse prices rise. Therefore, it seems to be somewhat effective in terms of increasing jeonse loans and then increasing demand for jeonse loans. However, in this area, where most landlords are about to retire, if they suddenly evaluate their repayment capabilities, they may cause bigger problems, so we should consider this as well.

[Anchor]
Unlike mortgage loans, jeonse loans guarantee the entire loan. That's why this risk seems to be greater, but there is also a wait-and-see stance that the amount of jeonse loans will reach 190 trillion and 200 trillion soon. Will these measures help reduce the size of lease on a deposit basis loans? [Chae Sang-mi] It's going to have an effect that can be reduced. But other than this, there are guarantee agencies in Korea. Korea Housing Finance Corporation, Korea Housing & Urban Guarantee Corporation, and three Seoul Guarantee Insurance. The guarantee agencies guarantee about 90% to 100% of the lease on a deposit basis. So there's also this problem where banks borrow with little loss burden. Therefore, even if the guarantee ratio of the guarantee institution is reduced from the current 90-100% to 80%, it will be necessary to apply a variety of complex measures because it can reduce moral hazard and risk management problems.

[Anchor]
In the meantime, the interest rate on the subscription account was raised, and the figures confirmed that the number of subscribers decreased by nearly 40,000 in a month. What do you see as the reason?

[CHAE SANGMI]
The ratio of holding subscription accounts to the population has already been saturated. It shows that it has reached a high net land. The population of
is continuously decreasing. The next important thing is that the sale price continues to rise. Therefore, some consumers believe that it is better to move to the trading market than to receive sales through subscription accounts, so the motivation for holding subscription accounts is decreasing. Then, in the third case, in Seoul, the sale price is too expensive, so competition is severe, so even if you have a subscription account, the probability of winning is very small. In the case of provinces, there is a large amount of unsold goods, so the motivation to receive sales through subscription accounts decreases, so it is analyzed that the number of subscribers is gradually decreasing.

[Anchor]
If you look at the additional points of the winning ticket, they say you have to hold it for a very long time. As a result, this uselessness seems to be spreading, but if you look at the next topic, the oil tax cut is about to end, and the government will be considering whether to add it or adjust it a little.

[CHAE SANGMI]
According to my analysis, I don't think I'll finish it right away. It looks like it's going to be extended, because international oil prices are still volatile. Because the Middle East is unstable. Then, consumer prices are said to remain stable at around 1.6%, but as a result, the economic burden needs to be reduced, so it is analyzed that the 20% reduction will be extended to 15% from the current 20% reduction.

[Anchor]
We will also wait for the government's decision. Lastly, we will look at the New York Stock Exchange, and this week is called the earnings big week.

[CHAE SANGMI]
About 20% of the companies proposed in the S&P 500 will announce their earnings this week. In particular, big tech companies such as Tesla and Amazon will announce their earnings. So, the market will depend greatly on how good their performance is. Netflix and TSMC released very good results last week. This time, blue-chip companies such as General Motors and Coca-Cola are also likely to release earnings to give stability to the market, but expectations are a little uncertain about Tesla's performance. Because I was very disappointed with taxis. In addition, key economic indicators will be released this week, including the Purchasing Managers' Index, PMI, weekly unemployment insurance applicants, and consumer attitude index, which shows the health status of manufacturing and services in the United States. So if these indicators are sluggish, concerns over the economic slowdown could grow again, so you should focus on this.

[Anchor]
I see. We looked at the New York Stock Exchange together. So far, I have been with Chae Sang-mi, a professor of business administration at Ewha Womans University. Thank you for talking today.