Strengthening Supervision of Six Financial Conglomerates Including Samsung and Hyundai Motor

[Asia Economy Reporter Kim Hyo-jin] The Financial Services Commission announced that the bill for the "Act on the Supervision of Financial Complex Corporate Groups," which allows financial authorities to manage and supervise the six major financial complex corporate groups with assets exceeding 5 trillion won, including Samsung, Mirae Asset, Hanwha, Hyundai Motor, Kyobo, and DB, passed the National Assembly plenary session on the 9th.

The government submitted the bill under the name "Financial Group Supervision," but during the discussion in the relevant standing committee, the Political Affairs Committee, the term "financial group" was changed to "financial complex corporate group."

The Financial Complex Corporate Group Act is part of the ruling party's "Three Fair Economy Acts," along with the Commercial Act and the Fair Trade Act.

The bill stipulates that among financial complex corporate groups engaged in two or more financial businesses such as deposit-taking and lending, insurance, and financial investment, and whose total assets of affiliated financial companies exceed 5 trillion won, those meeting the requirements prescribed by Presidential Decree shall be designated as supervision targets.

The representative financial company selected from the relevant financial complex corporate group must oversee and compile all tasks such as internal control, risk management, and soundness management, and submit them to the financial authorities.

Additionally, the financial complex corporate group must report and disclose the status of capital adequacy and risk factors at the group level.

If the Financial Services Commission's evaluation of the capital adequacy of a financial complex corporate group falls below the standards set by Presidential Decree, it may order the submission of a management improvement plan, including capital expansion.

The Financial Services Commission stated, "We expect that an autonomous risk management system will be established in which financial complex corporate groups recognize and manage risks at the corporate group level, which they have neglected until now."

Based on this, the Financial Services Commission explained that securing the financial soundness of financial groups will minimize risk transmission and simultaneous insolvency of financial complex corporate groups that may arise from future financial market instability, thereby preventing damage to financial consumers and investors in advance.

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