'Jeoljeolpo' Im Jong-ryong New Chairman, Woori Financial Group Expected to Experience 'Reform Wind'

'Never, Never Give Up'... Im Jong-ryong Nominee's Creed
Icon of Regulatory Reform
Will Start with Internal Innovation at Woori Financial Group

Im Jong-ryong Appointed as New Chairman of Woori Financial Group

[Asia Economy Reporters Sim Nayoung, Kwon Hyunji] "'Jeoljeolpo' was a phrase I used like a habit. It means 'We must never, ever give up on regulatory reform.'" "He was a persistent workaholic to the point that even junior public officials were amazed. He was the type who kept pushing to see how far he could go." (Senior officials at the Financial Services Commission)

Im Jong-ryong, former Financial Services Commission chairman, has been nominated as the new chairman of Woori Financial Group. If he is officially appointed at the regular shareholders' meeting on the 24th of next month, he is expected to immediately begin implementing the much-debated internal reform plans of Woori Financial Group. Last year, Woori Financial Group faced several issues including an embezzlement case involving employees amounting to around 70 billion KRW, disciplinary actions related to the Lime Fund mis-selling scandal, and recently, workplace harassment incidents.

A sweeping wave of reform expected in personnel, organizational culture, and portfolio

The Executive Candidate Recommendation Committee explained the reason for selecting Im Jong-ryong as "For Woori Financial to boldly innovate its organization, it is suitable to have someone who can objectively diagnose the organization and proactively lead reform."

The financial sector anticipates a major wave of reform within Woori Financial Group. A senior banking official said, "He was a person who upheld innovation and reform as his creed during his time as NH Nonghyup Financial Group chairman and Financial Services Commission chairman, so changes will come not only in personnel but also in Woori Financial Group’s corporate culture and work methods." He added, "Since Woori Financial Group’s portfolio has many shortcomings compared to other financial holding companies, efforts will focus on supplementing it, including acquiring securities firms."

During his tenure as Financial Services Commission chairman, he led the deregulation of insurance pricing for the first time in 23 years, laid the foundation for fintech development, approved internet banks, and oversaw the sale of shares in Woori Bank and Hanjin Shipping. He also eased regulations on private equity fund management, which has drawn criticism from some quarters as a cause of the private equity fund scandal. A financial authority official described him as "market-friendly to the extent of holding monthly financial reform meetings."

"A leader who builds self-renewal trenches is unacceptable"…Strong signals from financial authorities behind Im’s nomination

Despite controversies over government intervention, the reason Im Jong-ryong was finally selected goes beyond being a reform candidate; the financial authorities sent a strong message that "former insiders including former chairman Sohn Tae-seung are not acceptable." On the 1st, President Yoon Suk-yeol addressed public concerns about the replacement of CEOs at BNK, Shinhan, NH Nonghyup, and Woori Financial Group possibly signaling a return to government control, stating, "Since banks have a public goods aspect, I do not think the government’s interest in establishing fair and transparent governance constitutes government intervention."

A financial sector official said, "The authorities have repeatedly sent signals that they will not tolerate the behavior of financial company heads who build so-called 'trenches' by appointing outside directors as their allies for self-renewal." He added, "Among the seven major shareholders of Woori Bank, four are financial companies, so the outside directors they recommended could not help but be mindful of this atmosphere."

Meanwhile, the Woori Bank labor union has indicated a tough stance. Park Bong-su, chairman of the Woori Bank labor union, said in a phone interview, "We will watch how persuasive and sincere the reform plans brought by Im Jong-ryong are," but added, "There is no change to our existing stance opposing external appointments. We will, of course, take action to block his arrival at work."