Another Round of Debt Relief Risks a Cycle of Waiting It Out

The government has decided to broaden the range of loans the New Leap Fund can buy, extending debt forgiveness to borrowers who fell out of earlier restructuring programs after their finances deteriorated while they were repaying. Offering another chance to people who have already been through a workout for small delinquent debts is likely to raise questions about fairness and moral hazard. The change in criteria is expected to require the fund to purchase up to 1 trillion won ($720 million) in additional loans. Through the end of July this year, the…