[Woori Bank Embezzlement] Financial Supervisory Service to Review Inspectors and Supervisors in Charge of Woori Bank

Lee Junsu, Deputy Director of Banking at Financial Supervisory Service
"We are reviewing which inspections took place during the incident period"
Lee Wondeok, Bank President, responding to claims he was the accounting officer at the time
"It is difficult to discuss direct inspections at this moment"

Jung Eun-bo, Governor of the Financial Supervisory Service, presiding over the bank presidents' meeting at the Bankers' Hall in Jung-gu, Seoul on the 3rd.
[Photo by Yonhap News]

[Asia Economy Reporter Song Seung-seop] The Financial Supervisory Service (FSS) has begun reviewing the inspection and supervision tasks of Woori Bank and the personnel responsible for those tasks at the time. This is to investigate whether there was any internal supervisory failure amid rising calls for FSS accountability related to Woori Bank's embezzlement incident involving approximately 60 billion KRW. Depending on the investigation's findings, those responsible within the FSS could be identified.

On the 3rd, Lee Joon-soo, Deputy Director of the Banking Division at the FSS, met with reporters after attending a meeting between the FSS and domestic banks held at the Bankers Association building in Jung-gu, Seoul. He stated, "We are internally reviewing which inspections were conducted during the period when the incident occurred."

Lee added, "Although the FSS conducted various inspections, they are carried out after defining the scope in detail beforehand. It is necessary to determine whether it is appropriate to question the staff who conducted the DLF inspection about why they did not detect the Woori Bank embezzlement incident."

He further explained, "To make such a judgment, it will be clearer once we understand why the embezzlement occurred and why it was not detected."

When asked how the FSS would take responsibility, he replied, "Fact-finding comes first." On the same day, before entering the meeting venue, Jeong Eun-bo, Governor of the FSS, stated, "If there is responsibility in any case, it must be taken."

Regarding whether inspections of other banks' actual conditions would be conducted, Deputy Director Lee said, "We have urgently instructed inspections of internal controls to prevent financial accidents, including corporate restructuring, M&A, and fund management," emphasizing, "Based on the results, after the inspections are completed, necessary institutional improvements will be made."

However, when asked if there was a possibility of reconsidering the inspection methods, he firmly stated, "I believe it is not directly related."

Regarding the allegation that Lee Won-duk, President of Woori Bank, was responsible for internal accounting as an executive director in 2017, he said, "It is difficult to discuss direct inspections of President Lee at this point in time."

There were also questions about revising supervisory regulations to strengthen financial penalties, the possibility of CEO sanctions, inspections of retired personnel, and the incident's details, but Deputy Director Lee responded that "it is too early to discuss these matters now."