50 Financial Sector Heads with Expiring Terms... Who Will Survive the Personnel Storm?

Executives Including Holding Company Officers and Deputy Heads of Major Banks Among 100 Personnel Changes
Financial Association Chairman 'Gwanpia' Trend... Chairman Kim Tae-young's Term Ends on 30th
Former Financial Commissioners Choi Jong-gu and Lim Jong-ryong, Former Lawmaker Min Byung-doo Among Candidates
Shin Yong-gil, Life Insurance Association Chairman's Term Ends Next Month 8th... Former Government Officials Strongly Expected

[Asia Economy reporters Kangwook Cho and Minyoung Kim] Starting next month, a major personnel shakeup is expected to sweep through the financial sector. Including heads of financial associations and holding companies, as well as presidents of banks, insurance, and card companies whose terms expire by the first half of next year, there are about 50 top executives (CEOs) in the financial sector facing term completion. When adding holding company executives, deputy heads of major banks, and full-time audit committee members, the number of CEOs and executives with expiring terms easily exceeds 100. Amid various pressing issues surrounding the financial sector next year?such as profitability deterioration under the ultra-low interest rate environment and competition with big tech companies?this wave of change coupled with a 'generation shift' and accumulated personnel demand could literally bring about a 'personnel typhoon.'

According to the financial sector on the 9th, this personnel reshuffle is expected to be influenced by the rapidly changing financial environment, competition with big tech (large information and communication companies), performance, and the need for long-term management plans.

Despite 'Gwanpia' Controversy, 'Competent' Financial Association Heads Are Desperately Needed

In the case of financial association heads, the 'Gwanpia' (a portmanteau of bureaucrat and mafia) controversy is intense. Since the inauguration of the Moon Jae-in administration, with intensified government regulations and political interference, the industry is seen as desperately needing 'competent' association heads who can protect the sector more than ever.

For the successor to Kim Tae-young, whose term as chairman of the Korea Federation of Banks ends on the 30th, names such as former Financial Services Commission Chairmen Choi Jong-ku and Im Jong-ryong, and former Democratic Party lawmaker Min Byung-doo are being mentioned. The Korea Federation of Banks, which held its first chairman recommendation committee meeting on the 26th of last month, plans to select a shortlist in the third week of this month and appoint the final candidate around the fourth week. There is also a possibility of an unexpected figure emerging.

The term of Shin Yong-gil, chairman of the Life Insurance Association, also ends on the 8th of next month. Given that private-sector individuals have held the chairman position twice consecutively, there is speculation that this time a government (官) official is likely. Former Financial Services Commission Chairman Jin Dong-soo, former Financial Supervisory Service Governor Jin Woong-seop, and Insurance Training Institute Director Jeong Hee-soo are among the candidates. Earlier, on the 5th, the term of Kim Yong-duk, chairman of the General Insurance Association, ended, and Jeong Ji-won, current chairman of the Korea Exchange, has been appointed as his successor.

Interest in Reappointment of Kim Jung-tae of Hana Financial and Kim Kwang-soo of NH Nonghyup Financial

Among the five major financial holding companies, attention is focused on whether Kim Jung-tae, chairman of Hana Financial, and Kim Kwang-soo, chairman of NH Nonghyup Financial, whose terms expire in March and April next year, respectively, will be reappointed. Kim Jung-tae, who has already been reappointed twice (three terms), is known to have indirectly or directly expressed his intention not to seek another term. Currently 68 years old, even if Kim Jung-tae seeks reappointment, Hana Financial's internal governance rules stipulate that he can only serve one more year as he must not exceed 70 years of age. Hana Financial is expected to hold a chairman recommendation committee meeting around January next year to select the next chairman.

Kim Kwang-soo, who was reappointed once this year, faces a variable in that since the launch of Nonghyup Financial in 2012, no chairman has been reappointed more than once. Former chairman Kim Yong-hwan also served only one reappointment. Since Nonghyup Financial has preferred bureaucrats for the top position, the financial sector views it as highly likely that a bureaucrat will be appointed again this time. Kim Tae-oh, chairman of DGB Financial Group, has a term until March next year. Kim is 67 years old next year, and according to DGB Financial's internal governance rules, a chairman cannot be appointed or reappointed if over 67 years old.

Terms of Jin Ok-dong, Ji Sung-kyu, and Kwon Kwang-seok Also Expire

Regarding bank presidents, attention is on the reappointment of Shinhan Bank President Jin Ok-dong, whose two-year term ends at the end of this year. Jin is credited with achievements such as revising key performance indicators (KPIs) and securing digital capabilities, and considering the special circumstances of the COVID-19 pandemic, the view inside and outside the banking sector is that he is likely to continue his term.

The terms of Hana Bank President Ji Sung-kyu and Woori Bank President Kwon Kwang-seok expire at the shareholders' meeting in March next year. Ji is evaluated to have established a solid position with steady performance since his appointment until last year. Kwon, appointed for a one-year term in March this year, is heavily favored for reappointment. Woori Bank's executive recommendation committee has stated it will review Kwon's performance over the year before discussing term extension.

CEOs of regional banks are also facing term expirations in March next year. This includes Bin Dae-in of Busan Bank, Hwang Yoon-chul of Gyeongnam Bank, Lim Yong-taek of Jeonbuk Bank, Song Jong-wook of Gwangju Bank, and Seo Hyun-joo of Jeju Bank.

Many Insurance and Card Company CEOs Also Face Term Expiration: "Ultimately Performance"

In the insurance industry, 13 CEOs' terms are ending. Yang Jong-hee, CEO of KB General Insurance; Sung Dae-gyu, CEO of Shinhan Life; Jung Moon-guk, CEO of Orange Life; Heo Jung-soo, CEO of KB Life; and Hong Jae-eun, CEO of Nonghyup Life, will complete their terms next month. Additionally, Kim Yong-beom, CEO of Meritz Fire & Marine Insurance; Kim Jung-nam, CEO of DB Insurance; Byun Jae-sang, CEO of Mirae Asset Life; Yeo Seung-joo, CEO of Hanwha Life; Won Jong-gyu, CEO of Korean Re; and Choi Young-moo, CEO of Samsung Fire & Marine Insurance, have terms ending in March next year. However, the industry leans toward personnel decisions that emphasize organizational stability at this time, given the increased financial market volatility after COVID-19 and the upcoming introduction of International Financial Reporting Standard (IFRS-17).

The terms of presidents of five card companies?Shinhan, KB Kookmin, Hyundai, Woori, and BC Card?also expire before March next year. Im Young-jin, president of Shinhan Card; Lee Dong-cheol, president of KB Kookmin Card; and Jung Won-jae, president of Woori Card, all of whom were candidates for holding company chairman positions, will complete their terms in December. Lee Dong-myeon of BC Card, appointed this year, is highly likely to be reappointed. Jang Kyung-hoon, president of Hana Card, will complete his term in March next year.

Along with the expiration of top executives' terms, many executives of major financial holding companies and banks are also subject to movement. In the four major commercial banks?KB Kookmin, Shinhan, Woori, and Hana?about 60 executives excluding outside directors are known to have terms expiring at the end of this year. Additionally, the terms of auditors such as Joo Jae-sung of KB Kookmin Bank and Heo Chang-eon of Shinhan Bank, as well as full-time audit committee members of commercial banks, are also coming to an end one after another.

A financial sector official said, "It is premature to make assumptions about term extensions or replacements, but considering the personnel changes of major affiliate CEOs, a significant reshuffling is expected in the financial sector." He added, "In special situations like the current COVID-19 pandemic, ultimately, performance and crisis management will determine the fortunes of reappointments and replacements."

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