Lee Criticizes "Corrupt Inner Circle"... Financial Supervisory Service Likely to Inspect BNK Financial Group

Lee Chanjin, Governor of the Financial Supervisory Service. Photo by Hyunmin Kim

On December 19, President Lee Jaemyung delivered a strong criticism regarding the long-term rule of financial holding group chairmen during a Financial Services Commission work report, referring to it as a "corrupt inner circle where people take turns serving as bank CEOs and then as chairmen, monopolizing power for 10 to 20 years." In this context, it has been reported that the Financial Supervisory Service is set to launch an inspection into BNK Financial Group soon.

According to the financial industry on December 21, the Financial Supervisory Service is reportedly planning an inspection next month to examine whether there are any issues in the process of appointing the next chairman of BNK Financial Group. Previously, Lee Chanjin, Governor of the Financial Supervisory Service, stated during the presidential work report, "We are preparing to initiate inspections into financial holding companies where issues related to CEO appointments have been raised."

The BNK Financial Group board of directors had previously, on December 8, solely nominated Chairman Bin as the candidate for the next chairman. If his nomination passes the regular shareholders' meeting and the board of directors in March next year, his reappointment will be finalized. However, following the president’s public reprimand and the potential inspection by the Financial Supervisory Service, there is speculation that the outcome may impact the group’s governance structure.

The Financial Supervisory Service is reportedly preparing inspections not only for BNK Financial Group but also for several other financial companies where controversies have arisen over the appointment of chairmen or bank CEOs. There is a possibility that the inspection targets will include not only financial holding companies whose boards have already nominated candidates for the next chairman, but also those where nominations have not yet been made.

Currently, including BNK Financial Group, the Shinhan Financial Group board has solely nominated the current chairman, Jin Okdong, as the candidate for the next chairman. At the end of this month, Woori Financial Group will decide on its next chairman, with the current chairman, Lim Jongryong, seeking reappointment.