Kim Ji-wan BNK Financial Chairman Resigns Early... Attention on Whether Successor is Internal or External

Reelected in 2020 but Falls 5 Months Before Term Ends Amid 'Child Favoritism Allegations'

[Asia Economy Reporter Yoo Je-hoon] Kim Ji-wan, chairman of BNK Financial Group, has resigned early from his position as chairman, about five months before the end of his term.

BNK Financial Group issued a press release on the 7th announcing Kim's resignation. BNK Financial explained, "Chairman Kim deeply feels moral responsibility as the group chairman regarding the recent family-related allegations, and has decided to resign due to recent health deterioration and the need for management and organizational stability of the group."

Kim, a "securities man" who previously served as president of Buguk Securities, Hyundai Securities, and Hana Daetoo Securities (now Hana Securities), took office as chairman of BNK Financial Group in September 2017 and successfully renewed his term in March 2020, leading the group’s management for about five years. During his tenure, he was credited with not only improving performance but also driving balanced growth between banking and non-banking sectors.

However, with recent allegations of preferential treatment related to his children, Kim has borne the stigma of a dishonorable resignation like his two predecessors (former chairmen Lee Jang-ho and Sung Se-hwan). At a National Assembly audit held by the Political Affairs Committee last month, suspicions were raised that Hanyang Securities, where Kim’s son worked, was selected as a bond underwriter for bonds issued by BNK Financial affiliates and purchased a large volume of bonds worth about 1.2 trillion won, suggesting possible favoritism. The Financial Supervisory Service has also been conducting an on-site inspection related to this since last month.

With Kim’s early resignation, attention is turning to the next chairman candidates. Originally, BNK Financial decided in 2018, through amendments to the CEO candidate recommendation and management succession regulations, to appoint the chairman from internal succession among the holding company’s inside directors, executive officers (presidents or above), and affiliate representatives. However, due to concerns about the closed nature of the governance structure raised both internally and externally, the board of directors held a meeting on the 4th and added a clause allowing "external candidates to be nominated as chairman candidates upon recommendation by an external professional institution."

With the revised regulations, the new chairman selection is expected to be a competition between internal and external candidates. Among the nine internal candidates who are affiliate representatives, Ahn Gam-chan, president of BNK Busan Bank, is mentioned as a strong candidate. An insider familiar with the company’s internal affairs said, "There are other potentially strong internal candidates, but since the affiliate is currently under inspection by regulatory authorities due to allegations of preferential treatment involving children, the risk is considered high. President Ahn has shown good performance since taking office and has stood apart from the existing top management, so there should be no major issues."

Among external candidates, names such as Park Young-bin, chairman of the Construction Mutual Aid Association (former president of Gyeongnam Bank), Son Gyo-deok, former president of Gyeongnam Bank, Bin Dae-in, former president of Busan Bank, and Ahn Hyo-jun, former CEO of BNK Investment & Securities, are being discussed, along with former chairman Lee Pal-sung of Woori Financial Group. Industry insiders speculate that additional reputable figures from the financial sector may be added to the candidate pool to stabilize the organization, which has been unsettled by Kim’s resignation.

A BNK Financial official stated, "With the submission of the chairman’s resignation today, we will promptly hold a board meeting to prevent any management vacuum in the group and swiftly proceed with the next chairman selection process through the executive candidate recommendation committee. We will focus all our capabilities on fulfilling the group’s fundamental role of revitalizing the regional economy so that customers do not experience any inconvenience due to internal group issues."

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