Concerns Rise Over Increased Financial Market Volatility Amid Domestic and Global Political Shifts
Close Watch on Exchange Rate Impact
Emergency Meetings Convened... Enhanced Market Monitoring
As the domestic and international political landscape rapidly changes, including the decision to impeach President Yoon Suk-yeol following the United States' reciprocal tariff measures, the financial sector has entered a state of high alert. They are closely monitoring the market, concerned about the potential increase in volatility in financial markets such as exchange rates. CEOs of major financial groups are convening emergency meetings to review crisis response systems.
According to the financial sector on the 4th, KB Financial Group will hold an emergency executive meeting in the afternoon, chaired by Chairman Yang Jong-hee. The meeting will discuss the rapidly changing financial market conditions due to shifts in domestic and international political situations. KB Financial is currently operating an emergency response system that includes holding company executives and strategy officers from all affiliates. An emergency response team that monitors market trends such as capital market movements and exchange rate fluctuations in real time will operate even on weekends.
KB Financial is preparing to promptly respond by monitoring market conditions and assessing the impact on ongoing projects and strategies. They also plan to review various financial support measures to prevent the weakening of economic policy momentum and declining corporate investment sentiment from spreading to financially vulnerable groups such as small business owners.
Shinhan Financial Group will also convene a group crisis management committee in the afternoon, chaired by Chairman Jin Ok-dong. Affiliates including banking, card, securities, and insurance will hold consecutive meetings chaired by their respective CEOs.
A Shinhan Financial Group official stated, "Given concerns about domestic and international policy impacts and resulting exchange rate volatility, we will strengthen liquidity risk monitoring in foreign exchange and capital markets. Based on macroeconomic analysis by the Group’s Future Strategy Institute, we will diagnose the economy and establish a support system accordingly, preparing various support measures to aid the recovery of the real economy."
Hana Financial Group’s holding company and key affiliates’ executives have also begun reviewing risk situations by holding a group crisis management council. Previously, Hana Financial Group announced a financial support plan totaling 6.3 trillion won for small and medium-sized enterprises and small business owners expected to face difficulties due to the U.S. reciprocal tariff measures.
Woori Financial Group is responding by establishing management plans for different exchange rate levels through consultations among related departments within its emergency response organization, the Crisis Response Council. They also plan to strengthen management of exchange rate-sensitive assets such as derivatives. NH Nonghyup Financial will maintain an emergency contact system between the holding company and subsidiaries even on weekends to ensure prompt response. They will also take proactive measures by preemptively checking issues in vulnerable industries.
Meanwhile, on the same day, the Constitutional Court unanimously ruled to impeach President Yoon Suk-yeol. The day before, U.S. President Donald Trump announced a tariff policy imposing a 25% reciprocal tariff on Korean imports. As domestic and international political situations rapidly change, the won-dollar exchange rate rose to the 1,470 won level on the 31st of last month but has since dropped to the 1,430 won level, reflecting increased volatility in the foreign exchange market.
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