Consecutive 'Gwanchi Finance' Controversies... Lee Bok-hyun: "Authorities Must Speak with Principles"

Financial Supervisory Service Chief: "Words Spoken in Good Faith Will Be Clarified Later as Misunderstandings"

Lee Bok-hyun, Governor of the Financial Supervisory Service, is briefing on the results after holding a meeting with the chairpersons of bank holding company boards at the Bankers' Hall in Jung-gu, Seoul, yesterday afternoon.
[Image source=Yonhap News]

[Asia Economy Reporter Song Seung-seop] Lee Bok-hyun, Governor of the Financial Supervisory Service (FSS), said regarding remarks on the appointment of CEOs in the financial sector, "I think it is desirable for financial authorities to speak with principles."

Governor Lee Bok-hyun made these remarks on the 15th after attending the 'Financial Information Protection Conference' held at the Conrad Hotel in Yeongdeungpo-gu, Seoul, during a meeting with reporters. He said, "Since the comments were made with good intentions, most of the interpretations beyond that will later be resolved as misunderstandings."

On the 10th, regarding speculation that Sohn Tae-seung, Chairman of Woori Financial Group, might file a lawsuit against a disciplinary warning, Lee said, "Unlike in the past, now we need to cooperate closely with financial authorities and institutions regarding rapid market fluctuations," and added, "I believe the person involved will make a wiser decision." The day before, he also emphasized, "There should be standards that meet the public's expectations in the process of selecting a successor for the CEO."

This sparked controversy in the financial sector over 'government-controlled finance,' as many financial institutions' CEOs are set to end their terms either at the end of this year or in March next year. Chairman Sohn Tae-seung's reappointment is uncertain due to a heavy disciplinary action related to the Lime Fund scandal. BNK Financial Group held a board meeting the day before to activate the executive nomination committee. The terms of Cho Yong-byeong, Chairman of Shinhan Financial Group, Sohn Byung-hwan, Chairman of NH Nonghyup Financial Group, and Jin Ok-dong, President of Shinhan Bank, are also about to expire.

Baek Hye-ryun, Chairperson of the Political Affairs Committee of the Democratic Party, also met with reporters the day before and said, "While the financial authorities can take disciplinary actions, the timing is sensitive," and added, "Since the heads of financial institutions are about to be reappointed, it is necessary to avoid any misunderstandings." Regarding the Financial Services Commission's decision on heavy disciplinary action against Chairman Sohn, she said, "I respect it, but it should not be a preemptive measure to install a parachute candidate."

In particular, the delayed disciplinary decision on the Lime Fund by the Financial Services Commission and Governor Lee's recent meeting with the chairpersons of bank holding companies' boards led to interpretations that "financial authorities are exerting external pressure on the private sector." In response, Governor Lee said, "The event yesterday was planned a long time ago," and added, "The decision of the Financial Services Commission's plenary meeting is not something I decide." He explained, "The timing was coincidental."

When asked about the discussions at the Lime Fund Dispute Mediation Committee held the previous day, he replied, "We prepared several times more than usual for agenda preparation and discussions," and said, "I was informed that the committee members reviewed the pros and cons of the conclusion, legal issues, and facts." He continued, "Since it is an important issue, I also believe we should not limit the number of meetings or time," and said, "We focus on ensuring it operates in principle according to the law and system, while trying to minimize influence on the outcome."

Regarding the recent collapse of the digital asset exchange FTX, he said, "The primary goal is to block risks that could affect our traditional financial market," and added, "As for damages within the virtual asset market itself or preventive measures, they are different in nature, so we are assessing the necessity."

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