Next 5 Major Bank Presidents Appointment, Full-Scale Start... Reappointment VS Replacement

First Management Succession After Introducing Governance Best Practices
KB to Hold Candidate Recommendation Committee Meeting
Shinhan Initiated Procedure After Convening Candidate Recommendation Committee on the 10th
Hana and NH Plan to Activate Candidate Recommendation Committees This Month
Woori to Hold Board Meeting on the 27th... Attention on Jo Byeonggyu CEO's Position

In accordance with the governance best practices that financial authorities began applying this year, major commercial banks are set to officially commence the procedures for appointing new heads. Since the terms of major bank presidents expire at the end of this year, procedures such as recommending candidates for the next president must begin three months prior to the end of their terms, in line with the governance best practices.

According to the financial sector on the 23rd, the terms of presidents of major commercial banks including KB Kookmin, Shinhan, Hana, Woori, and NH Nonghyup will expire on December 31. With financial holding companies announcing board meetings and nomination committees this week, the decision on whether current bank presidents will be reappointed is expected to be confirmed by November.

KB Financial Group will hold a nomination committee meeting for subsidiary CEO candidates this week. Once the committee finalizes candidates, KB Kookmin Bank will appoint its president through the bank president nomination committee’s review and recommendation process. Lee Jae-geun, president of KB Kookmin Bank who took office in January 2022, is the only one among the top five bank presidents in his third year of term this year. However, since the previous president, Heo In, successfully secured reappointment and held the position for five years, the possibility of reappointment carries significant weight. Nonetheless, the burden remains due to the largest compensation liability among commercial banks this year caused by the incomplete sale of Hong Kong H-Index (Hang Seng China Enterprises Index, HSCEI) equity-linked securities (ELS).

Shinhan Financial Group convened its subsidiary CEO nomination committee on the 10th and began the succession process for subsidiary heads. The committee plans to collect succession candidates, conduct a first screening, then announce the final candidates after an in-depth review process and submit them to the board. Although current president Jeong Sang-hyuk was not exempt from the Hong Kong H-Index ELS incident, he has received more positive evaluations, such as leading the 'leading bank' position by surpassing KB Kookmin Bank, which faced a heavy ELS compensation burden in the first quarter of this year.

Hana Bank and NH Nonghyup Bank will also soon hold executive nomination committees and begin the process of appointing bank presidents. Hana Financial Group is actively proceeding with the successor process for Lee Seung-yeol, whose term ends this year, and since Chairman Ham Young-joo’s term also ends in late March next year, procedures to decide on reappointment will begin by the end of this year. Lee Seung-yeol maintained the top spot in net profit in his first year last year and is evaluated to have led solid performance this year by steadily increasing assets, mainly through corporate loans.

Since reappointment is not customary at NH Nonghyup Bank, the possibility of reappointing Lee Seok-yong, president of NH Nonghyup Bank, is highly uncertain. Moreover, there have been four employee embezzlement incidents this year, including an incident in August where employee A, accused of embezzling 11.7 billion KRW by using an acquaintance’s name, took extreme measures. With Lee Seok-jun, chairman of NH Nonghyup Financial Group, also ending his term at the end of this year like President Lee Seok-yong, both the holding company and the bank plan to fully activate the executive nomination committee within this month.

Woori Bank President Cho Byung-kyu is reportedly expressing his intention to seek reappointment internally, but the recent widespread scandal involving former Woori Financial Group Chairman Sohn Tae-seung’s relatives’ improper loans has increased the burden on his future path. President Cho has been leading the bank for one year and two months since succeeding former president Lee Won-duk’s remaining term in July last year. Woori Financial Group and Woori Bank plan to hold board meetings on the 27th, and Woori Bank intends to select one candidate after verification based on a pool of candidates chosen by the holding company’s subsidiary CEO nomination committee.

A financial authority official stated, "We understand that major commercial banks have already conducted or are planning to conduct internal procedures in accordance with the governance best practices," adding, "Since this is the first procedure after the introduction of the best practices, we expect it to be conducted transparently and fairly."

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