Financial Authorities: "Pilot Operation of Responsibility Maps for Large Specialized Credit Finance Companies and Savings Banks"

Various Incentives to Be Provided for Participation in Pilot Operation

On January 14, the government announced that it will begin a pilot operation of responsibility maps for large specialized credit finance companies and savings banks.

The Financial Services Commission and the Financial Supervisory Service stated on January 14 that large specialized credit finance companies and savings banks will be included as targets for the pilot operation of responsibility maps. A responsibility map is a document that details the allocation of responsibilities by position for each executive within a financial company.

According to the Act on Corporate Governance of Financial Companies (the Corporate Governance Act), which took effect on July 3, 2024, large specialized credit finance companies, savings banks, as well as small investment companies and insurance companies, must submit their responsibility maps by July 2. Previously, banks, financial holding companies, and large investment companies and insurance companies submitted their responsibility maps last year.

The financial authorities explained that the pilot operation is being implemented to encourage large specialized credit finance companies and savings banks to introduce and operate internal control management systems based on responsibility maps at an early stage.

Large specialized credit finance companies and savings banks wishing to participate in the pilot operation may submit their responsibility maps to the Financial Supervisory Service by April 10, following a resolution by their boards of directors. From the date of submission until July 2, they can conduct the pilot operation, including implementing internal control and management measures.

Financial companies participating in the pilot operation will be granted incentives. The Financial Supervisory Service plans to provide consulting, including inspection and advisory services, on the responsibility maps submitted by financial companies during the pilot period. In addition, during the pilot period, even if internal control and management obligations are not fully met, companies will not be held liable under the Corporate Governance Act.

The authorities emphasized that if, during the pilot operation of internal control management systems based on responsibility maps, a company detects and corrects legal violations by its executives or employees on its own, related sanctions will be reduced or exempted.