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Breaking the Tradition of 'Bank Deputy Head → Subsidiary CEO' to Enhance Competitiveness Through Change and Innovation

[Asia Economy Reporter Kwon Haeyoung] Yoon Jongwon, President of IBK Industrial Bank of Korea (IBK), plans to recruit some subsidiary CEOs from outside the bank. Until now, IBK has never publicly recruited subsidiary CEOs. Breaking the convention where bank vice presidents automatically move to subsidiary CEO positions, Yoon aims to bring in external experts for subsidiaries requiring specialized skills, thereby enhancing the bank's competitiveness.

According to financial industry sources on the 17th, President Yoon is considering publicly recruiting some IBK subsidiary CEOs.

A senior IBK official stated, "This subsidiary CEO appointment is challenging, and after the second half of the year, we are considering external recruitment for some subsidiaries. For subsidiaries requiring external expertise, we plan to conduct the process through public recruitment to ensure fairness."

Currently, IBK has eight subsidiaries: IBK Capital, Pension Insurance, Savings Bank, Asset Management, Credit Information, Service, Investment Securities, and Systems. Except for IBK Credit Information, seven of the eight subsidiaries' CEOs are former IBK vice presidents or corporate heads. Until now, the official path was 'IBK Vice President → Subsidiary CEO,' but President Yoon intends to appoint capable external professionals to positions requiring expertise.

The timing is expected to be after the second half of the year. There is not enough time to conduct public recruitment for subsidiary CEO positions during the executive personnel reshuffle scheduled for the 20th. Among IBK subsidiaries, the CEO terms of IBK Investment Securities, Pension Insurance, Systems, Asset Management, and Credit Information have expired or will expire by the end of this month. Starting with IBK Service at the end of the year, the CEO terms of IBK Capital and Savings Bank will also expire sequentially early next year.

President Yoon's consideration of hiring external CEOs aims to select experts where needed to enhance organizational capabilities and to bring change and innovation to the traditionally conservative, bank-centered organizational culture. To become a competitive comprehensive financial group, it is urgent to improve subsidiary competitiveness, which lags behind other financial holding companies. There is also a possibility of recruiting external personnel within the bank.

In his inaugural speech, he emphasized breaking the pure-blood system, saying, "Iron is stronger when mixed with other metals than when it is pure," and added, "We will create an organization full of change and vitality by freely discussing diverse opinions and fully utilizing external expertise when necessary."

Other financial holding companies are also expanding the recruitment of external experts for CEO and executive positions. Shinhan Financial Group appointed Sung Daekyu, a former bureaucrat and former head of the Insurance Development Institute, as CEO of Shinhan Life Insurance. Woori Financial Group also appointed external figures such as Noh Jinho, former CEO of Hangul and Computer, as well as personnel from Samsung Securities and Daum Communications, to holding company executive and department head positions. This reflects the judgment that survival is difficult with only the perspectives of existing bankers in the rapidly changing financial environment.

Meanwhile, President Yoon will conduct the bank executive personnel reshuffle on the 20th and then proceed with subsidiary CEO appointments. The timing for subsidiary CEO appointments is expected around March. He is also considering reducing the number of executives in some subsidiaries.