Financial Supervisory Service Issues 'Caution on Financial Incidents' Notice to Shinhan Cambodia Bank

The Financial Supervisory Service (FSS) has notified Shinhan Bank's local subsidiary in Cambodia, Shinhan Cambodia Bank, to strengthen internal controls related to financial incidents.

According to the FSS on the 20th, an inspection of Shinhan Cambodia Bank pointed out four management advisory matters: strengthening internal controls related to financial incidents, enhancing the independence of audit and risk management tasks, reinforcing internal controls related to financial incidents, and improving loss absorption capacity.

It was found that Shinhan Cambodia Bank did not establish separate measures to prevent financial incidents and did not implement prevention measures such as ordered leave and rotational work prepared by the head office. There were also cases where departments unrelated to financial incident response received reports of financial incidents and only reported them to the head office six months after recognizing the occurrence.

As of the end of September last year, Shinhan Cambodia Bank's level of allowance for loan losses was insufficient, and all executives, including the corporate head, were evaluated on performance in audit, compliance monitoring, and risk management tasks, resulting in a lack of operational independence.

Shinhan Bank entered Cambodia in September 2007 and has established a network of branches in key areas within the capital, Phnom Penh.

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