Financial Services Commission Chairman and Financial Holding Company Presidents, Biweekly Meetings Silent

[Asia Economy Reporter Song Hwajeong] Interest is growing in the background as regular meetings between the Financial Services Commission (FSC) Chairman and the heads of financial holding companies continue to be postponed.

According to financial authorities and the financial sector on the 6th, no meeting schedule between the FSC Chairman and the heads of financial holding companies has been set this week either.

FSC Chairman Kim Joo-hyun had agreed on the 1st of last month, during a meeting with the heads of financial holding companies, to formalize the 'FSC Chairman - 5 Major Financial Holding Companies' Heads Meeting' on a biweekly basis to monitor market conditions until the market stabilizes. However, more than a month has passed since then, and no follow-up meetings have been held.

A meeting was scheduled for the 18th of last month but was ultimately canceled. Despite the FSC Chairman stating that he would meet periodically, the meeting has not taken place, leading to various speculations within the industry.

One of the reasons cited for the postponement of the meetings is the National Assembly. Delays in the budget approval process in the National Assembly have affected the scheduling of meetings between the FSC Chairman and the heads of financial holding companies. Due to conflicts between the ruling and opposition parties over the budget, the scheduled Legislation and Judiciary Committee subcommittee meeting at the end of last month was canceled, and deliberations on FSC-related bills were suspended. With numerous bills pending, such as the amendment to the Electronic Financial Transactions Act and the Digital Asset Act, the FSC is closely monitoring the National Assembly's movements. The budget is no exception. The FSC has submitted budget proposals for major projects, including fintech support programs, anti-money laundering initiatives, contributions to the Korea Inclusive Finance Agency for youth hope savings, youth leap accounts, and special guarantees for low-credit borrowers, as well as capital contributions to the Korea Asset Management Corporation (KAMCO) for debt adjustment programs for small business owners and self-employed individuals. A banking sector official said, "A meeting was scheduled once on the 18th of last month but was canceled due to National Assembly schedules and other reasons."

Meanwhile, there is speculation that the postponement may be related to the disciplinary action against Sohn Tae-seung, Chairman of Woori Financial Group. At the 20th regular meeting of the FSC held on the 9th of last month, disciplinary action of a 'reprimand warning' was decided against Sohn Tae-seung regarding the incomplete sale of Lime Fund by Woori Bank. A reprimand warning or higher is a severe disciplinary action that restricts employment in financial companies for 3 to 5 years, making Sohn's reappointment, whose term expires in March next year, uncertain. Especially, the disciplinary action against Sohn, which had been delayed until now, was decided at the first regular meeting held after the meeting between the FSC Chairman and the heads of the 5 major financial holding companies, which surprised the industry. A financial holding company official said, "Since the authorities imposed disciplinary action to block reappointment, it might be awkward for Sohn to appear together with other financial holding company heads in a public setting, which could be why the meetings are being postponed repeatedly."

With the year-end approaching and personnel changes expected among the heads of major financial companies, the meetings between the Chairman and the heads of financial holding companies are likely to be further delayed. An FSC official said, "We are still coordinating schedules, but since it is the year-end and a busy time for planning next year's agenda, it is not easy to align schedules."

Financial Services Commission Chairman Kim Ju-hyun is taking a commemorative photo with the chairmen of the five major financial holding companies at the Bankers' Hall in Jung-gu, Seoul, on the 1st of last month. From the left, Cho Yong-byeong, Chairman of Shinhan Financial Group; Sohn Tae-seung, Chairman of Woori Financial Group; Yoon Jong-kyu, Chairman of KB Financial Group; Kim Ju-hyun, Chairman of the Financial Services Commission; Kim Kwang-soo, Chairman of the Korea Federation of Banks; Ham Young-joo, Chairman of Hana Financial Group; Sohn Byung-hwan, Chairman of NongHyup Financial Group.
Photo by Kim Hyun-min kimhyun81@