The Background of Kwon Kwang-seok's Appointment as Woori Bank President... Will the Son Tae-seung-Kwon Kwang-seok Administration Sail Smoothly?

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Kwon Kwang-seok, Nominee for President of Woori Bank

[Asia Economy Reporter Kwon Haeyoung] Kwon Kwangseok, CEO of the National Credit Guarantee Federation of Saemaul Geumgo, has been appointed as the next CEO of Woori Bank. The financial sector regards this as a 'surprise.' Kwon is evaluated as being free from responsibility for the derivative-linked fund (DLF) scandal that shook Woori Bank and having a solid network across the financial sector, government, and National Assembly through extensive external affairs experience. It is analyzed that the outside directors appointed Kwon as the next CEO to improve the uncomfortable relationship with financial authorities. Attention is also focused on whether the Son Taeseung-Kwon Kwangseok administration will sail smoothly as the bank and holding company CEOs are separated.

On the 12th, Kwon said in a phone interview with Asia Economy, "Woori Bank's current 'triangular axis' of system, customer trust, and mutual trust and confidence among employees has collapsed," adding, "Restoring trust and confidence among employees and stabilizing the organization is the top priority. We must soothe frontline employees who interact with customers, take good care of customers, and become a bank that helps customers to return to normal management."

Regarding efforts to improve relations with financial authorities, he said, "It is a bit delicate to mention," adding, "If there are misunderstandings or mental barriers, I will ask for understanding. Having been away for two years, I can look at the organization objectively. I will do my best."

One of the reasons for Kwon's appointment is considered to be the improvement of relations with financial authorities. Kwon's two-year absence from Woori Bank, along with his broad network, affability, and breakthrough ability gained through external affairs such as government relations and public relations, are cited as strengths. Initially, Kim Junggi, head of Woori Bank's division who worked closely with Chairman Son, was a strong candidate for the next CEO, but some outside directors, including those from IMM Private Equity, opposed this, leading to Kwon's appointment. It is interpreted that concerns arose that appointing someone close to Chairman Son as CEO, following Son's challenge to the DLF heavy disciplinary action through administrative litigation to extend his term, could further strain relations with financial authorities. It is also rumored that financial authorities preferred Kwon as the next CEO. Ultimately, both inside and outside Woori Financial Group analyze that Kwon was appointed as a 'troubleshooter' to manage the broken organization and improve communication and relations with financial authorities.

The financial sector is paying attention to the future power dynamics between Chairman Son and appointee Kwon. Woori Financial Group relies heavily on the bank, which accounts for 90% of the group's total assets and profits. Since the holding company was launched in January last year, it has been expanding affiliates through mergers and acquisitions (M&A), but acquisitions of securities and insurance companies remain, so there is still a long way to go to complete the holding company system. The reason Woori Financial Group's board chose a dual role for the holding company chairman and bank CEO when transitioning to a holding company early last year is also due to this background.

Currently, since both stabilizing the bank organization and completing the holding company system are major tasks for Woori Financial Group, it is expected that Chairman Son will focus on strengthening the holding company system while appointee Kwon will concentrate on stabilizing the bank organization, working in harmony. However, some cautiously raise concerns that the chairman and CEO might check and balance each other, potentially causing discord.

Meanwhile, Chairman Son significantly strengthened the holding company organization through a reorganization the day before. The number of vice presidents at the holding company increased from two to six, and the number of managing directors and executive directors rose from three to eight. New departments for strategy, public relations and branding, and financial consumer protection were established. Since completing the holding company system through diversification of holding company affiliates is urgent, efforts will be focused on building the holding company system through future M&A activities.

This content was produced with the assistance of AI translation services.