HUG, Which Took Full Action Against Rental Fraud, Becomes Only Institution Head Recommended for Dismissal in Management Evaluation

Byungtae Yoo Appointed President in June 2023
Three Consecutive Years of "D" Grade... JDC and SR Also Receive "D" Evaluations

In the public institution management evaluation announced on June 20, Byungtae Yoo, President of the Housing and Urban Guarantee Corporation (HUG), received a "D" (Unsatisfactory) grade and became the only head among the 87 evaluated institutions this year to be recommended for dismissal. He became subject to this recommendation after receiving a "D" grade for two consecutive years, including last year. According to relevant regulations, an institution head is subject to dismissal recommendation if they receive the lowest "E" (Very Unsatisfactory) grade or a "D" grade for two consecutive years.

HUG received a "C" (Average) grade in the 2022 evaluation. However, with "D" grades last year and this year, the institution has now received a "D" grade for three consecutive years. For a dismissal recommendation to be made, the head must receive the lowest "E" grade or a "D" grade for two consecutive years, and the length of their tenure is also considered. Byungtae Yoo was appointed in June 2023, so he was not subject to dismissal recommendation last year. The President of HUG is appointed by the President of the Republic of Korea upon the recommendation of the Minister of Land, Infrastructure and Transport.

Byungtae Yoo is an alumnus of Seoul National University School of Law, like former President Yoon Suk Yeol, and was a classmate of Minister Won Hee Ryong, who was serving as Minister of Land, Infrastructure and Transport at the time of Yoo's appointment, both being from the class of 1982. Yoo has extensive experience working in real estate finance companies, including Korea Long-Term Credit Bank and major trust companies. His original term is three years, extending until June next year.

Byungtae Yoo, President of the Housing and Urban Guarantee Corporation, is responding to a lawmaker's question during the 2023 National Assembly Land, Infrastructure and Transport Committee’s audit of the Korea Real Estate Board and the Housing and Urban Guarantee Corporation. Photo by Hyunmin Kim kimhyun81@

HUG primarily handles various guarantee services, including housing pre-sale and real estate project financing (PF). As of last year, it also served as the exclusive management institution for the Housing and Urban Fund, which amounts to 120 trillion won. With rental fraud emerging as a social issue in recent years, HUG's financial performance has deteriorated. This is due to an increase in subrogation payments made to tenants who joined the deposit return guarantee. Last year, the company recorded a net loss of 2.5 trillion won, marking its third consecutive year of losses.

Public institutions under the Ministry of Land, Infrastructure and Transport, including HUG, generally received low grades in this evaluation. The Jeju Free International City Development Center, which was at the center of political controversy over the appointment of its head, and SR, a high-speed rail operator, both received "D" grades, each dropping one level compared to last year. Incheon International Airport Corporation fell from an "A" grade to a "C" grade, while Korea Airports Corporation rose from a "D" to a "C" grade.

The National Railroad Authority improved from a "C" to a "B" grade, and Korea Railroad Corporation rose from a "D" to a "C" grade. Korea Land and Housing Corporation (LH), which usually receives harsh evaluations due to its high debt, improved from a "C" grade last year to a "B" (Good) grade this year. Korea Transportation Safety Authority received an "A" (Excellent) grade for the second consecutive year, while Korea Expressway Corporation received a "B" grade.

SR high-speed train. Provided by SR

Separate from the management performance evaluation, the heads of organizations such as the National Railroad Authority, Korea Expressway Corporation, Korea Railroad Corporation, and LH, where serious industrial accidents occurred, received warnings. Korea Railroad Corporation and Korea Airports Corporation, both of which recorded net losses, were advised to reduce or voluntarily return 25% of major executives' performance bonuses.