Financial Holding Companies Owning Savings Banks to Be Exempt from Regular Major Shareholder Eligibility Reviews

Enforcement Decree Amendment of the Mutual Savings Banks Act Passed by Cabinet Meeting

The Financial Services Commission announced on December 16 that the amendment to the Enforcement Decree of the Mutual Savings Banks Act, which exempts financial holding companies from regular major shareholder eligibility reviews under the Mutual Savings Banks Act, has passed the Cabinet meeting.

Under the Financial Holding Companies Act, financial holding companies are subject to institutional mechanisms designed to ensure sound management of the entire group and to fulfill their responsibilities as major shareholders. Accordingly, when acquiring shares of a savings bank or establishing a subsidiary, they are deemed to meet the requirements for major shareholders. Related laws such as the Banking Act also exempt them from regular eligibility reviews.

Through this amendment, the Financial Services Commission has decided to exempt financial holding companies, which are major shareholders of savings banks, from regular major shareholder eligibility reviews. This is to enhance consistency in the legal framework across different times and sectors.

The amended Enforcement Decree will take effect from December 23, the date of promulgation. An official from the Financial Services Commission stated, "This will reduce the regulatory compliance burden for financial holding companies that own savings banks and is expected to further incentivize financial holding companies to acquire savings banks."