FSS Governor Meets ECB President: "Consumer Protection Is Top Priority in Virtual Asset Oversight"

Attendance at the GHOS Meeting of the Basel Committee on Banking Supervision

Discussions on Market Trends with European Financial Supervisory Authorities

"Establishing Soundness Standards for Banks' Virtual Asset Exposures"

Lee Chan-jin, Governor of the Financial Supervisory Service, met with Christine Lagarde, President of the European Central Bank (ECB), and emphasized that financial consumer protection is the top priority in the process of overseeing virtual assets. He also conveyed that, despite heightened volatility in domestic and global financial markets due to rising tensions in the Middle East, the Financial Supervisory Service is doing its utmost to ensure financial market stability and maintain the soundness of financial institutions by leveraging its accumulated crisis response experience.

Financial Supervisory Service Commissioner Lee Chan-jin (right) and Christine Lagarde, President of the European Central Bank (ECB), are taking a commemorative photo. Financial Supervisory Service

According to the Financial Supervisory Service on March 12, Governor Lee attended the Group of Governors and Heads of Supervision (GHOS) meeting, the highest decision-making body of the Basel Committee on Banking Supervision (BCBS), held in Basel, Switzerland, on March 9 (local time).

At the meeting, Governor Lee engaged in in-depth discussions on the implementation status of Basel III among member countries and regulatory measures for the soundness of virtual asset exposures (risk-weighted assets). The meeting was attended by heads of financial supervisory authorities and central bank governors from 28 major countries, including the United States, Europe, and Japan.

The participants generally evaluated the progress of Basel III implementation among member countries positively but emphasized that, in light of recent increases in global financial market volatility, the importance of a robust global regulatory framework and a fair regulatory environment has grown even further. Accordingly, they reaffirmed that all member countries must implement Basel III standards promptly and consistently. There was also a consensus to continuously monitor and assess the implementation status of Basel III among member countries through the BCBS.

Discussions also continued regarding the establishment of soundness standards for virtual assets. The participants approved measures for the BCBS to review soundness standards for banks’ virtual asset exposures as well as methodologies for assessing globally systemically important banks (G-SIBs), in consideration of recent trends in the virtual asset market and the existing Basel regulatory framework.

During the meeting, Governor Lee separately met with ECB President Lagarde and Petra Hielkema, Chairperson of the European Insurance and Occupational Pensions Authority (EIOPA), to exchange views on financial market trends resulting from the recent Middle East crisis, oversight of digital assets, and measures to protect consumers of insurance and pension operators.

In his meeting with President Lagarde, Governor Lee explained that although financial market volatility is increasing both domestically and internationally due to rising tensions in the Middle East, the Financial Supervisory Service is fully committed to financial market stability and the soundness of financial companies based on its accumulated crisis response experience. He also emphasized that, in the process of introducing and operating supervisory systems related to digital and virtual assets, financial consumer protection and financial stability are being prioritized above all else.

On March 10, Governor Lee met with EIOPA Chairperson Hielkema and requested cooperation to ensure the smooth progress of the scheduled equivalence assessment of reinsurance regulations between Korea and the European Union (EU). Governor Lee stated that if Korea’s and the EU’s reinsurance supervisory systems are recognized as equivalent, domestic insurance companies will be able to enjoy the same effects as being licensed within the EU, which is expected to greatly benefit their business activities in the European market.

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