The Calligrapher Who Blocked Illegal Agricultural Distribution Became a Pillar of Financial Services for Ordinary People [Manbojeongdam]

Kim Yoonsik, Chairman of the National Credit Union Federation of Korea, Interview
Rose to CEO after the "Illegal Wholesale" Incident at Daegu Agricultural and Marine Products Market
Became Chairman After Refusing to Ignore the Struggles of Local Credit Unions
"Proud of Early Lifting of Management Normalization Agreement"
Regrets Not Being Able to Ease Deposit-Related Regulations
Advises New Chairman to "Focus on Soundness Management and Uphold the Role of Financial Services for Ordinary People"

On December 3, in the president's office at the National Credit Union Federation headquarters in Daejeon, Kim Yoonsik, Chairman of the National Credit Union Federation of Korea, had traditional Korean calligraphy tools on his desk. With Chinese President Xi Jinping recently gifting such tools to President Lee Jaemyung, it sparked curiosity about whether calligraphy was his hobby. Given his career background, it seemed somewhat unexpected. "I first encountered it in elementary school, but I started practicing in earnest in my late twenties when my mother fell ill," Chairman Kim recalled. While caring for his mother at home, he chose calligraphy as a hobby that allowed him to respond immediately when she called and helped him cultivate calmness. This hobby soon became a profession, and in 1997, he won the top prize in the calligraphy category at the Korea Art Exhibition (Kukjeon) and later served as a judge for the event. How did someone on such a promising path as a calligrapher end up joining the credit union?

Chairman Kim Yoonsik has never turned away from people in need, personally stepping in to resolve issues and driving change from wholesale corporations to credit unions. Reflecting on his tenure as chairman, he shared his thoughts and urged the next chairman, who will be elected next month, to uphold the credit union's identity as a "financial institution for ordinary people."

Kim Yoonsik, Chairman of the National Credit Union Federation of Korea, is taking a walk around the headquarters of the Daejeon Credit Union Federation. Photo by Jo Yongjun

Lying in Front of a Truck to Prevent Illegal Distribution of Agricultural Products... "Could Not Ignore the Difficulties of Local Credit Unions Either"

During the period when Chairman Kim won the award at Kukjeon, illegal distribution was rampant at the Daegu Agricultural and Marine Products Wholesale Market in Buk-gu, Daegu. Some intermediate wholesalers (who broker sales to retailers through auctions) were bypassing the auction process to trade agricultural products directly, or recording lower prices in auction ledgers to evade fees and taxes. When some of these intermediaries were arrested and punished, the city of Daegu recommended that major shareholders directly manage the wholesale corporations. This was because wholesale corporations were not properly reporting violations of market order by intermediaries to local authorities, as required to maintain auction order.

At the time, Chairman Kim held shares in a wholesale corporation called Hyosung Fruits & Vegetables through his father but had never been directly involved in management. In his late thirties, he became the CEO of Hyosung Fruits & Vegetables and worked to normalize the auction process in the market. "It was a rainy day, and when I learned that an illegal distribution truck was coming in, I went out and lay down in front of the truck to block its entry," he recalled. His efforts eventually led to changes in the market, and after about ten years, the Daegu Agricultural and Marine Products Wholesale Market saw its auctions normalized. Hyosung Fruits & Vegetables also grew significantly; when he became CEO, annual sales were only 20 billion won, ranking among the lowest of over 200 wholesale corporations nationwide, but it has since grown to a 300 billion won company.

Kim Yoonsik, Chairman of the National Credit Union Federation of Korea, is being interviewed by The Asia Business Daily at the National Credit Union Federation headquarters in Daejeon. Photo by Jo Yongjun

His entry into the credit union was also prompted by his inability to ignore someone in need. In 1998, the chairman of Daegu Saerim Credit Union, facing management difficulties, took note of the Hyosung Fruits & Vegetables case and offered Kim a director position. After the chairman stepped down, Kim became the new chairman. At the time, Saerim Credit Union's assets were only 6 billion won due to the aftermath of the IMF financial crisis, making it difficult even to pay staff salaries.

He persuaded intermediate wholesalers and merchants from his base at the Daegu Agricultural and Marine Products Wholesale Market to join the union, increasing capital and deposits to grow its assets and restore management stability. As a result, Saerim Credit Union has transformed into a mid-sized union with assets of 300 billion won. Kim later served as chairman of the Daegu Regional Credit Union Council and as a board member of the National Credit Union Federation, before becoming chairman of the federation in March 2018.

Even at the age of 69, Chairman Kim serves as a board member of the World Council of Credit Unions (WOCCU) and as chairman of the Asian Confederation of Credit Unions (ACCU). His secret to good health is doing three sets of bodyweight exercises such as push-ups and squats every day without fail. "I do as many reps per set as I can until I feel pain," he said with a laugh. In addition, he shared that walking around the federation headquarters or around Suseong Lake in Daegu is his own way of healing.

"Most Proud of Early Lifting of Management Normalization Agreement"

Having served as chairman of the National Credit Union Federation for eight years, including reappointment since 2018, he cited three moments he was most proud of: ▲the early lifting of the management normalization agreement ▲the support system for agricultural and small credit unions ▲the eight major inclusive finance policies. During the financial crisis, the federation suffered deficits due to insolvencies at individual unions. In 2007, it received 260 billion won in public funds and entered into an agreement with the government, committing to financial improvements and related tasks. Under this agreement, the federation was subject to regulatory oversight, including restrictions on business budget growth and regional office consolidation. The management improvement order, originally set to last until 2024, was lifted early in 2023.

The support system for agricultural and small credit unions provides material and human resources from the federation to unions with weaker management environments compared to large unions in major cities with solid business foundations. Chairman Kim said, "While first-tier banks are closing branches in provincial areas due to declining profitability, the credit union, as a financial institution for ordinary people, cannot simply reduce branches for profit. On the contrary, we must fill the financial gaps for marginalized groups such as the elderly caused by bank withdrawals." The support system ranges from providing daily necessities for members, improving branch environments, to supporting local festivals for regional economic revitalization. From 2020 to last year, the total amount of support reached approximately 117.5 billion won.

The eight major inclusive finance policies have been key projects pursued by the credit union over the past seven years to address social issues such as low birth rates, aging, and regional depopulation. The most successful example is support for the Jeonju Hanji (traditional Korean paper) industry. Heuksseokgol in Jeonju once had over 300 Hanji workshops, but now only six remain. Chairman Kim said, "Revitalizing local industries and preserving traditional culture is the credit union's duty," and signed a business agreement with Jeonju City and the Jeonju Hanji Business Cooperative to support R&D, sales, training successors, and localizing raw materials. In addition, the "8.15 Liberation Loan," which converts high-interest loans to mid-interest rates, recorded 68,957 cases and a total of 777.2 billion won in loans over five years.

"Regret Not Being Able to Ease Deposit-Related Regulations"

Not everything over the past eight years was a source of pride. Chairman Kim Yoonsik expressed regret over not being able to ease regulations on mutual finance, especially those related to deposits, which are the main source of funding. While banks have various funding methods such as issuing bank bonds in addition to deposits and savings, mutual finance institutions mainly rely on one-year term deposits and member contributions. He said, "First-tier banks have many demand deposits and diverse funding methods, so they can raise funds at lower interest rates. It would be good if mutual finance institutions could also participate in local government treasury bids and if regulations were relaxed."

Kim Yoonsik, Chairman of the National Credit Union Federation of Korea, is being interviewed by The Asia Business Daily at the headquarters of the Daejeon Credit Union Federation. Photo by Jo Yongjun

Advising the New Chairman on Soundness Management and Financial Services for Ordinary People

On January 7 next month, the National Credit Union Federation will have a new chairman for the first time in eight years. Due to term limits, Chairman Kim is not eligible to run and will conclude his journey with the credit union. He left generous advice for his successor. First and foremost, he emphasized thorough soundness management. "There are signs across the industry that the financial environment will worsen next year," he said. "This will affect not only the credit union but also the entire mutual finance sector, and especially, delinquency rate management will be crucial."

Chairman Kim also added, "For the sake of the ordinary economy, it is important to make various efforts, especially to uphold one of the credit union's core identities-serving ordinary people." He then introduced the case of the credit union receiving a blessing from the Vatican in 2020. The Vatican highly praised the credit union for actively practicing inclusive finance for the socially disadvantaged and financially marginalized over the past 60 years and held the award ceremony in Busan, the birthplace of the Korean credit union. "It was more than just an honor; it gave me a sense of responsibility that the credit union must further strengthen its social role," Chairman Kim emphasized.

He also urged the continuation of the support system for agricultural and small credit unions. He suggested that the next chairman further activate the "co-growth system," where larger unions help smaller ones, to reduce the operational burdens on small unions and create a virtuous cycle that returns financial benefits to union members.

-Profile of Kim Yoonsik, Chairman of the National Credit Union Federation of Korea

▲Born in Daegu in 1956 ▲CEO of Hyosung Fruits & Vegetables ▲CEO of Hotel Ariana ▲CEO of Muminjae ▲Chairman of the Daegu Regional Credit Union Council ▲Director of the National Credit Union Federation ▲Chairman of the Korea Cooperative Council ▲Director of the World Council of Credit Unions ▲Chairman of the Asian Confederation of Credit Unions ▲Chairman of the National Credit Union Federation of Korea