Appraisers' Association: "Ministry Deems It Illegal, But Kookmin Bank Persists With 'Self-Appraisal' for Three Months"

Sixth Protest Rally to Be Held in Front of Kookmin Bank Headquarters on the 18th

The Korea Association of Property Appraisers announced on the 17th that it will hold its sixth protest rally in front of the KB Kookmin Bank headquarters in Yeouido, Seoul, on the morning of the 18th. This marks the third consecutive month of strong protest actions since the first rally in September.

Ministry of Land, Infrastructure and Transport Rules "Illegal" ... KB Kookmin Bank Remains Silent

KB Kookmin Bank employs its own in-house appraisers to directly assess the value of collateral for loans. Article 5, Paragraph 2 of the Appraisal Act stipulates that when a financial institution needs to appraise collateral in work involving loans, asset sales, or financial statement preparation-where conflicts of interest may arise-it must entrust the appraisal to an external appraiser.

The association argues that if a bank, as an interested party, sets collateral prices on its own, fairness is undermined and the principle of protecting financial consumers is lost. In fact, the volume of KB Kookmin Bank’s in-house appraisals surged nearly threefold in three years, from 26 trillion won in 2022 to 75 trillion won this year.

In September, the Ministry of Land, Infrastructure and Transport also issued an authoritative interpretation stating that such in-house appraisals by financial institutions constitute a violation of the Appraisal Act. The association criticized, "Continuing illegal practices despite the government’s official finding of a legal violation is a blatant disregard for the rule of law and a disruptive act in the market."

On the 11th, in front of the KB Kookmin Bank headquarters in Yeouido, Seoul, appraisers held the 5th KB Kookmin Bank Appraisal Market Illegal Invasion Condemnation Rally. Korea Association of Property Appraisers

Association: "Distortion Under the Pretext of Fees"

Some in the banking sector claim that outsourcing appraisals to external parties could increase costs and thus raise loan interest rates. In response, the association countered, "We are not calling for a ban on collateral valuation itself, but rather pointing out the illegality of banks conducting appraisal work using appraisers they directly employ."

The association further noted, "KB Kookmin Bank’s net interest income increased by about 1.5 times, from 7.1 trillion won in 2021 to 9.6 trillion won last year, but appraisal fees remained at around 30 billion won per year," adding, "The claim that appraisal fees are reflected in loan interest rates and increase the burden on ordinary people is far from the truth."

Yang Gilsu, president of the association, stated, "Public interest and financial stability can never be treated as commodities," and urged, "For KB Kookmin Bank to fulfill its social responsibility, it must not act shamefully before the public, the law, and the future of the financial industry, and must immediately cease illegal appraisal practices."

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