Dong-geol Lee, Chairman of Korea Development Bank, "KIKO Compensation? No Reason and Should Not Be Done"

"Financial Supervisory Service Above the Law? Illogical and Populist Judgment"

[Asia Economy Reporter Jo Gang-wook] Lee Dong-geol, Chairman of the Korea Development Bank, stated on the 12th regarding the foreign exchange derivative product KIKO issue, "There is no need to compensate, no reason to do so, and I believe compensation should not be made."

At an online press conference held that day, Chairman Lee said, "There is no change in the basic position that compensation is difficult."

He cited three reasons for refusing compensation: ▲ inability to legally understand the judgment ▲ the matter is legally concluded ▲ suspicion toward the affected company.

Chairman Lee first said he could not understand the Financial Supervisory Service's (FSS) judgment.

He said, "It is difficult to accept the concept of mis-selling legally," adding, "The FSS's claim of mis-selling is more of a populist judgment than a logical one, so compensation is impossible."

He also pointed out, "Overturning a court decision in a legally concluded situation could remain a very bad precedent in the history of South Korean finance," calling it "undesirable."

Chairman Lee said, "It is right to follow the court's decision until the court itself reverses it," and criticized, "Is the FSS above the law? The idea that only enforcement by my own hand is right is a very dangerous thought."

He also raised doubts about Ilseong Hi-Sco, which claims to be the affected company and a counterparty to the Korea Development Bank's transactions.

He said, "Ilseong Hi-Sco is an expert company that earned a total of 3.18 billion KRW, averaging 800 million KRW annually, through KIKO transactions from 2004 to 2007," adding, "The proportion of KIKO profits in net income increased from the 10% range to over 40%, and they indulged in derivative financial products as much as their main business. It is unacceptable to call it mis-selling just because they suffered losses in the last transaction."

Then Chairman Lee said, "I do not understand the FSS dispute mediation," and questioned, "We should worry about the future, leaving the past behind. If we keep dwelling on the past, when will we do new things?"

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