Today's FSC Audit... Issues on Private Equity Funds, Merge Point, Household Debt, etc.

Jeong Eun-bo, First Financial Supervisory Service Chief's Audit Since Inauguration

[Asia Economy Reporter Park Sun-mi] The National Assembly's Political Affairs Committee will conduct a state audit of the Financial Supervisory Service (FSS) on the 7th. Eun Bo Jeong, the head of the FSS, will appear before the audit for the first time since taking office two months ago.

According to the financial sector on the 7th, during the morning session of the audit on the FSS, questions are expected regarding follow-up measures related to the private equity fund (PEF) incident, including compensation for victims and sanctions against financial companies.

Recently, the court ruled in the first trial to cancel the heavy sanctions imposed by financial authorities on Sohn Tae-seung, chairman of Woori Financial Group, holding him responsible for losses related to the overseas interest rate-linked derivative-linked fund (DLF) incident. The FSS has decided to appeal this ruling. The FSS's excessive use of disciplinary authority related to the PEF incident during the tenure of former FSS chief Yoon Seok-heon may also come under scrutiny again.

Issues concerning retired FSS employees who have been re-employed after leaving the FSS and the treatment of FSS staff may also be discussed during the audit. This year, 28 retirees who worked at the FSS resigned and were re-employed with approval from the Government Ethics Committee for Public Officials. Controversy arose as more than half of these re-employed retirees, 15 in total, moved to the financial sector, which traditionally prefers re-employment.

Questions regarding the FSS's response efforts to the Merge Point incident and measures to prevent similar cases in the future are also expected. Additionally, since many members of the Political Affairs Committee requested data from the FSS on major banks' loan status and branch closures, inquiries about the FSS's position and countermeasures on these matters are anticipated.

Furthermore, as household debt and the Hwacheon Daeyu issue were hot topics during the Financial Services Commission audit the previous day, it is highly likely that the FSS chief's opinions and calls for measures on household debt will be raised again during this audit. There is also a strong possibility that the controversy over Hana Bank, the lead bank for the Daejang-dong development project, receiving an additional 10 billion KRW from the developer 'Seongnam-ui Tteul' will be discussed again.

Meanwhile, the National Assembly's Political Affairs Committee conducted an audit of the Financial Services Commission the previous day and plans to hold audits on the Korea Development Bank, Industrial Bank of Korea, Korea Credit Guarantee Fund, and Korea Inclusive Finance Agency on the 15th, and on the Deposit Insurance Corporation, Korea Asset Management Corporation, Korea Housing Finance Corporation, and Korea Securities Depository on the 18th.

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