Jo Yong-byeong, Chairman of the Korea Federation of Banks, "Apologies and Regrets over the ELS Incident"

Regarding Compensation Proposal as the "Starting Point of Communication"

Jo Yong-byeong, Chairman of the Korea Federation of Banks, expressed his "apologies and regrets" on the 11th regarding the loss incident related to the Hong Kong H Index (Hang Seng China Enterprises Index·HSCEI) underlying equity-linked securities (ELS).

At a press conference held that afternoon, Chairman Jo said, "I also suffered a lot and reflected deeply due to private equity funds during my tenure at Shinhan Financial Group, and despite the introduction of the Financial Consumer Protection Act afterward, such an incident has occurred again," responding in this manner.

Regarding the compensation plan announced by the financial authorities that day, he said, "This is only the starting point for communication among the market, consumers, and authorities," and added that it would serve as an "intermediary" for communication based on common issues across the entire banking sector as well as individual issues by each bank.

Chairman Jo responded that the banking sector has been well prepared for loan loss provisions due to Tae Young Construction's workout and real estate project financing (PF). He stated, "Since we have been proactively accumulating loan loss provisions since COVID-19, I believe the capacity to absorb losses is sufficient."

He also expressed his ambition to faithfully fulfill the Korea Federation of Banks' original role and contribute to the national economy. Chairman Jo said, "(The role of the Korea Federation of Banks) is to coordinate quietly not only for banks but also for the national economy," and added, "We will convey the private sector's on-the-ground voices and facilitate communication to ensure that issues discussed in the banking sector's institutional improvement task force, banks' non-financial ventures, and strengthening synergies among financial group subsidiaries proceed smoothly."

Cho Yong-byeong, Chairman of the Korea Federation of Banks, is giving opening remarks at a press conference held on the afternoon of the 11th. [Photo by Korea Federation of Banks]