[Exclusive] Financial Supervisory Service Officially Launches Dedicated Inspection Team for Saemaeul Geumgo

Saemaeul Geumgo Under Ministry of the Interior and Safety... Financial Supervisory Service Control Criticized as 'Loose'
Calls for Strengthened Supervision After Last Year's 'Bank Run' Incident
MOU Planned Including Inspection Regulations with Saemaeul Geumgo and Others

The supervisory authorities will officially launch the Saemaeul Geumgo inspection team on the 9th. Going forward, the Financial Supervisory Service (FSS) will oversee Saemaeul Geumgo's internal controls and soundness.

According to the financial authorities, the FSS Mutual Finance Bureau has completed the staffing of Inspection Team 4, which is dedicated to inspecting Saemaeul Geumgo. The team consists of a team leader and three members, and plans to expand to four members by March.

Saemaeul Geumgo, Credit Unions, NH Nonghyup, Suhyup, and the Korea Forestry Cooperative each fall under different government ministries. Among mutual finance institutions under financial authorities' supervision, only Credit Unions are directly overseen. For this reason, the FSS has dispatched personnel to support Saemaeul Geumgo inspections only upon requests from the Ministry of the Interior and Safety.

Last year, issues arose as the corporate loan delinquency rate at Saemaeul Geumgo surged. When a bank run (massive withdrawal of deposits) occurred at individual cooperatives, calls to establish a dedicated inspection team for Saemaeul Geumgo within the FSS became widespread.

The Financial Services Commission, FSS, Ministry of the Interior and Safety, and Saemaeul Geumgo Central Association will sign a memorandum of understanding (MOU) by the end of this month, enabling them to exercise inspection authority and data request rights.

After signing the MOU in the fourth week of January, the FSS plans to determine inspection regulations, inspection plans, procedures, and sanction levels for Saemaeul Geumgo. Separately, the Saemaeul Geumgo Central Association will report the implementation status of management innovation plans to the financial and supervisory authorities.

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