[2020 National Audit] Yoon Seok-heon "Promoting Improvement of Bank Branch Closure Guidelines"

[Asia Economy Reporter Kim Min-young] Yoon Seok-heon, Governor of the Financial Supervisory Service (FSS), announced on the 13th that he is improving the guidelines for bank branch closures.

At the FSS audit held by the National Assembly's Political Affairs Committee on the same day, Governor Yoon stated, "We will utilize various ideas such as mobile branches and joint branches," and added, "We are working on improving the guidelines for bank branch closures."

In response to a point raised by Yoo Dong-soo, a member of the Political Affairs Committee from the Democratic Party of Korea, Yoo pointed out, "Banks are closing branches citing profitability reasons, but in the United States, prior notification and post-evaluation are conducted. Japan also has a prior notification system, and the United Kingdom is trying to switch from self-regulation to a prior notification system."

According to data on the consolidation status of branches of the four major commercial banks?KB Kookmin, Shinhan, Woori, and Hana Banks?submitted to Bae Jin-gyo, a member of the same Political Affairs Committee from the Justice Party, the number of branches decreased from 3,513 at the end of 2015 to 2,964 at the end of last August.

Banks currently conduct prior impact assessments according to the "Joint Procedures for Bank Branch Closures" established by the Korea Federation of Banks last year, and based on the assessment results, they prepare alternative measures. However, since the prior impact assessments are conducted internally by the banks themselves, questions about their effectiveness have been raised.

Governor Yoon said, "We are promoting guidelines to lead prior measures." He added, "Even if individual banks or institutions think it is the best option, it may not be so from an overall perspective," and emphasized, "For the elderly, bank branches are a channel to the financial sector, so this should be respected."

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