'Aggressive Moves' Lee Bok-hyun, Pressuring 2nd Financial Sector for 'Coexistence' After Banks?

On the 29th, Lee Bok-hyun, Governor of the Financial Supervisory Service, attended the 'Woori Card Vulnerable Groups Sponsorship Fund Delivery Ceremony and Small Business Owners Meeting' held at the Good Neighbors Hall in Yeongdeungpo-gu, Seoul. Before the event began, he was seen conversing with Lim Jong-ryong, Chairman of Woori Financial Group. Photo by Yoon Dong-joo doso7@

Lee Bok-hyun, Governor of the Financial Supervisory Service (FSS), has emphasized win-win finance to the secondary financial sector, including card companies, following major commercial banks. While some view Governor Lee's proactive approach since his appointment as a positive step toward fostering win-win finance, there are also criticisms that this deviates from the core role of the FSS governor.

According to the financial sector on the 30th, Governor Lee attended a donation ceremony and a small business owners' meeting for vulnerable groups at the Good Neighbors Hall in Yeongdeungpo-gu, Seoul, along with Lim Jong-ryong, Chairman of Woori Financial Group, and Park Wan-sik, President of Woori Card, the day before. On the same day, Woori Card announced a win-win finance plan worth 220 billion KRW to support small card merchants and vulnerable groups.

This is not the first time Governor Lee has emphasized win-win finance to financial companies. Earlier, from February to March, he made relay visits to the four major commercial banks: KB Kookmin, Shinhan, Woori, and Hana Bank. In response to his visits, the banks prepared nearly 800 billion KRW in financial support measures, including loan interest rate reductions.

Now, Governor Lee's attention seems to be shifting to the secondary financial sector. He stated the day before, "I hope that win-win efforts like those of Woori Card will expand throughout the financial sector," adding, "It is important for financial companies to practice sustainable win-win finance by developing specialized financial products to support vulnerable groups. I urge not only banks and insurance companies but also card companies and financial investment (securities) firms to strive to develop various win-win finance products."

However, the financial sector's view of Governor Lee is not entirely favorable. A senior financial official said, "It is necessary to consider whether this is truly the FSS's role. The FSS's main task is to supervise the soundness of the financial market, not to implement financial policies supporting vulnerable groups," adding, "If the Financial Services Commission did this, it would align with the organization's purpose, so it would not be an issue, but in the case of the FSS, this is a report outside the organization's purpose and resembles a politician's stance."

Card companies have also expressed some dissatisfaction. With their own financial situations difficult, they feel pressured by the authorities, responding as if "fleas are being squeezed dry." In fact, card companies posted their worst performances in the first quarter of this year, following last year. Among the seven specialized card companies, Shinhan Card, the industry leader, recorded the best performance with a 5.3% decrease in net profit compared to the same period last year. Large companies such as Samsung Card (-9.5%), Hyundai Card (-7.9%), and KB Kookmin Card (-31%), as well as Hana Card (-63%) and Lotte Card (-40.5%), showed double-digit declines. Woori Card, which announced the win-win finance plan this time, saw its net profit shrink to 45.8 billion KRW, nearly half (-46.4%) compared to the same period last year. The future remains bleak. Funding costs remain high, fee rates are declining, and the growth potential of new businesses is uncertain.

A card company official said, "There is a reaction that the win-win finance plan was proposed by the card company with the worst performance because Lim Jong-ryong, Chairman of Woori Financial Group, is a former government official," adding, "Since the mid-2000s, the card fee rates for small and micro merchants have only been lowered, saving trillions of won, but now being asked to propose additional win-win finance plans feels like squeezing a dry towel."

However, regarding concerns that card companies may feel burdened by the win-win finance plans, Governor Lee explained, "We have never demanded this from the entire card sector," and added, "Although the FSS cannot proactively speak out, if card and capital companies with capacity propose such plans, the authorities would support them to some extent."

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