Bank salaries provoke ire
After the disclosure Tuesday of the annual salaries of chief executives at major conglomerates, the former heads of foreign banks operating in Korea received scathing criticism for reporting huge incomes in spite of recent falling profits.
Former Citibank Korea Chairman and CEO Ha Yung-ku raked in 7.1 billion won ($6.4 million) in 2014, making him the highest paid among the heads, according to data from the Financial Supervisory Service’s electronic disclosure system.
The data also showed 4.6 trillion won worth of retirement allowances in Ha’s reported nearly 2.9 billion won annual salary. Ha had an annual salary of 2.8 billion won.
Ha resigned from his former post in order to run for KB Financial Group chairman last year.
Although he failed to receive the appointment, he is the current Korea Federation of Banks chairman.
Citibank Korea posted 115.6 billion won in net profits in 2014, plunging 47 percent from the profits posted last year.
The trade union of the bank criticized management for the decreased profits, as well as for the 24 percent increase in operating costs at a March 27 bank shareholders’ meeting.
The management and trade union have been conflicting over the bank’s falling profits, as the trade union argued that management had been transferring excessive amounts in management fees to the U.S. headquarters.
Citibank Korea transferred 210 billion won to its U.S. headquarters, including dividend returns.
As of last June, Citibank Korea had laid off 652 employees and consolidated 56 bank branches, citing falling profits. A report last year by Standard Chartered Bank Korea showed former President Richard Hill receiving a 2.7 billion won annual salary that included 2.1 billion won in incentives.
The London-based bank laid off around 200 employees while closing 44 bank branches last year.
Hana Financial Group Chairman Kim Jung-tai, with a 1.7 billion won annual salary, was the second-highest paid among the CEO’s of Korean financial institutions.
Shinhan Financial Group Chairman Han Dong-woo took 1.2 billion won last year. The institution is the biggest in terms of asset size.
Han’s 2014 salary was about 100 million won less than his 2013 salary.
BY SONG SU-HYUN [firstname.lastname@example.org]