What Happened Leading Up to Im Jong-ryong's Appointment as the New Chairman of Woori Financial Group?
[Asia Economy reporters Sim Nayoung and Kwon Hyunji] The meetings of the Executive Candidate Recommendation Committee resembled a 007 operation until Lim Jong-ryong, the newly appointed chairman of Woori Financial Group, was selected. The four meetings held from January 18 to February 3 were conducted in strict secrecy. Unlike other financial holding companies where the final interview location was disclosed and candidates shared their impressions with reporters on the day of the final interview, this process was markedly different. A financial sector insider said, "There was strong pressure from financial authorities until Chairman Sohn Tae-seung decided to voluntarily resign, and later, controversies over government intervention arose during the selection process, making the situation sensitive."
The Recommendation Committee Determined "An Outsider Is Needed"
Park Sang-yong, an outside director of Woori Financial Group, summarized the reason for Lim’s appointment in a phone interview with Asia Economy on the 5th: "Now is a time when reform is more necessary than stability. There have been many incidents, including the embezzlement of 70 billion won. We judged that it would be better for an experienced outsider to take charge. If an outsider leads, it is less likely that the existing order will be maintained as is."
Lim’s obstacle was the label of "government-controlled finance" attached to him because of his background as a public official. However, those close to him say that the authorities do not see Lim as a civilian figure. A senior government official close to him said, "Lim was the person who successfully privatized Woori Bank and had the will to lead that organization as chairman. It is correct to see that this challenge was something he wanted himself, not a recommendation from the administration or financial authorities. Rather, it seems he was stressed by the 'government-controlled finance' controversy," he said.
The financial authorities’ intervention stopped at the point of "no internal candidates including former Chairman Sohn Tae-seung." The Financial Services Commission chairman and the Financial Supervisory Service chief repeatedly sent signals that they would not tolerate financial company heads who built "trenches" by appointing outside directors as their allies for "self-renewal." A senior financial sector official said, "Outside directors recommended by Woori Financial’s major shareholders had to be mindful of this atmosphere," adding, "Ultimately, this is why the weight tipped toward Lim Jong-ryong, an outsider."
A Wave of Reform Expected at Woori Financial... Employees Want Change
The financial sector expects a major wave of reform within Woori Financial going forward. Changes are anticipated not only in personnel but also in corporate culture and work methods. Since Woori Financial’s affiliate portfolio is relatively lacking compared to other financial holding companies, efforts to supplement this, including acquiring a securities firm, are necessary. Lim also stated, "When I assume the chairmanship, I will innovate the organization and establish a new corporate culture."
Among bureaucrats, Lim is regarded as an "icon of reform." Public officials who worked with him said, "He habitually used the phrase 'jeoljeolpo,' meaning 'never, ever give up on regulatory reform,'" and "He was a persistent workaholic to the point that junior officials were amazed. He was the type who kept pushing to see how far he could go."
During his tenure as chairman of the Financial Services Commission, Lim led the liberalization of insurance pricing for the first time in 23 years, laid the foundation for fintech development, approved internet banks, privatized Woori Bank, and restructured Hanjin Shipping. He also eased regulations on private equity fund management, which some criticize as having contributed to private equity fund scandals. A financial authority official described him as "market-friendly to the extent of holding monthly financial reform meetings."
The Woori Bank labor union has indicated a tough stance. Park Bong-su, chairman of the Woori Bank labor union, said, "We will see how persuasive and sincere the reform plans Lim brings are," but added, "There is no change to the existing stance opposing outsiders. Naturally, we will block his entry to work."
Meanwhile, among regular employees who want a change in atmosphere, voices are calling for the elimination of factions and self-preservationism within the organization. An employee of Woori Bank said, "The 'risk-averse' culture rooted since the time of public fund injection and the atmosphere of 'looking out only for my people and my position' from the top in a company without a clear owner must disappear," adding, "Many believe that bringing in an outsider at this timely moment was appropriate."
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