Savings bank executives flush despite suspensions

Although savings banks have been suffering from losses and the threat of insolvency for a sustained period, they have still been paying their top executives hundreds of millions of won a year, the Financial Supervisory Service (FSS) said yesterday.

Solomon Savings Bank Chairman Lim Suk received 410 million won ($361,000) in 2010, despite his bank recording a 126.6 billion won loss that year. Lim was arrested in May for allegedly offering bribes to political heavyweights from 2007 to try and stop the bank being suspended.

That same month, Solomon’s operations were suspended due to its high risk of going bankrupt.

Lim’s salary for last year has not been revealed.

Executives and board members at other suspended savings banks were also generously rewarded as shareholders suffered.

The average salary for executives at Jeil Savings Bank was 300 million won last year, followed by Tomato Savings Bank (235 million won), Jinheung Savings Bank (160 million won) and Hyundai Swiss (152 million won).

Meanwhile, senior figures at Samsung Life Insurance received an average annual salary of 4.8 billion won that same year, the highest figure among banking, securities, insurance and card, and savings bank industry, the data showed.

Samsung Fire & Marine Insurance ranked second that year in terms of companies that best compensate their upper-echelon managers (3.9 billion won), followed by Meritz Fire & Marine Insurance (3.2 billion won) and Mirae Asset Securities (2.1 billion won).

In the banking sector, executives at foreign banks were paid much more than their counterparts at domestic banks, the report from the FSS’ Data Analysis, Retrieval and Transfer System (DART) showed.

Citi Bank’s average salaries for executives stood at 810 million won in 2011, followed by Korea Exchange Bank (744 million won) and Standard Chartered Korea (558 million won).

Executives at Hana Bank received the highest salary among domestic players, earning 771 million won on average last year, followed by Shinhan Bank (387 million won) and Industrial Bank of Korea (342 million won).

By Kim Mi-ju [mijukim@joongang.co.kr]