[2025 National Audit] "Mild Disciplinary Actions for Savings Banks and Mutual Finance Raise Recurrence Risks"

Sanctions Imposed on 79 Savings Banks and Mutual Finance Institutions Over Five Years Since 2021
Savings Banks Account for 63.3%... Most Actions Are Minor Disciplinary Measures

There have been criticisms that most of the disciplinary actions imposed by the Financial Supervisory Service (FSS) on savings banks and mutual finance institutions are merely a slap on the wrist, raising concerns about the likelihood of recurrence.

According to data submitted by the office of Kang Minguk, member of the People Power Party, from the FSS, a total of 79 companies received disciplinary actions from 2021 through August 2025, with 468 measures imposed on companies or their executives and employees.

By year, the number of companies disciplined was 19 in 2021, 9 in 2022, 24 in 2023, and 22 in 2024, with 5 companies disciplined as of August this year. By sector, savings banks accounted for 50 cases (63.3%), the highest, while mutual finance institutions accounted for 29 cases (36.7%).

Kang Ming-guk, member of the People Power Party.

When looking at disciplinary actions by target, 'employees' accounted for 307 cases (65.6%), the largest share. This was followed by 'executives' with 128 cases (27.4%), and 'financial companies' with 33 cases (7.1%).

Among savings banks, OK Savings Bank received the most disciplinary actions, with 28 cases. In the mutual finance sector, the National Agricultural Cooperative Federation (NongHyup) also had 28 cases, the highest in its category.

Regarding the severity of disciplinary actions against financial companies, 'institutional caution' accounted for 18 cases (54.6%), followed by 'institutional warning' with 13 cases (39.4%), and 'suspension of business' with 2 cases (6.1%). Minor disciplinary actions made up 93.9% (31 cases) of all measures.

In the savings bank sector, there were 13 cases of 'institutional caution', 9 cases of 'institutional warning', and 2 cases of 'suspension of business'. In the mutual finance sector, there were 5 cases of 'institutional caution' and 4 cases of 'institutional warning'.

For executives, the most common disciplinary action was 'caution', with 75 cases (58.6%). This was followed by 'cautionary warning' (28 cases, 21.9%), 'reprimand warning' (14 cases, 10.9%), 'suspension from duty' (8 cases, 6.3%), and 'recommendation for dismissal' (3 cases, 2.4%). Considering that 'reprimand warning' and above are classified as severe disciplinary actions, most disciplinary measures for executives were also minor.

Over the past five years, the FSS imposed a total of 37 fines amounting to 2.54 billion won on the savings bank and mutual finance sectors. By sector, savings banks accounted for 28 cases (2.166 billion won), and mutual finance institutions for 9 cases (344 million won), indicating that fines were overwhelmingly imposed on savings banks.

Kang Minguk stated, "Although there have been around 500 disciplinary actions against savings banks and mutual finance institutions, the vast majority have been minor measures such as caution, reprimand, or fines, amounting to little more than a slap on the wrist and increasing the likelihood of recurrence. Financial authorities must develop effective and practical measures to prevent recurrence, rather than relying on uniform sanctions, in order to prevent major financial accidents, strengthen internal controls, and restore consumer trust in the financial sector."

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