Yim vows to push tough reformsFinancial Services Commission Chairman Yim Jong-yong has pledged to carry out more aggressive reforms in the financial sector next year and showed frustration about the financial reform bills that are sitting idle at the National Assembly.
“Reforms so far have been kind, which earned support from many, but from next year, I will not hesitate with tough reforms that could even face opposition,” the chairman said Monday at a press conference held in central Seoul. “I will accept opposition, overcome it, and meet opponents and persuade them when needed.”
Yim said he had a year to sow the seeds of reforms and he expected to reap tangible benefits next year.
“Financial reforms were the only initiative that made me move for the past nine months,” Yim said. “The biggest challenge was to win trust from the market and the general public who don’t yet know what financial reforms really are.”
2015 has been a year of reforms for the entire financial industry as the top regulator and its chief never stopped emphasizing the importance of changes throughout the year.
“We can never, never, never give up deregulation,” Yim said targeting the financial regulator in January when he was serving as chairman of NH Nonghyup Financial Group.
Yim became the FSC chairman in March, and has continued to fight for reforms. “A major achievement of this year is that we have raised awareness about the need for change among financial institutions,” Yim said.
As soon as he was inaugurated, the chairman emphasized that listening to the market is the most critical step in policymaking. The FSC set up a group that discusses complaints with financial institutions.
“I visited and met with associates of 434 financial institutions and received about 3,000 complaints, which have been a solid base for starting the reforms,” Yim said.
But he showed concern about the bills that are pending at the National Assembly, which are necessary to move forward with his plan. The bills involve cutting interest rates for private lenders from the current highest 34.9 percent to 29.9 percent, and prompting corporate restructuring.
“The bills regarding financial reforms are necessary and there shouldn’t be political interests involved,” the chairman said.
One of the bills is aimed at extending a sunset clause in the country’s Lending Business Act. If the bill is not passed it will allow private lenders, capital firms and savings banks to raise interest rates as much as they want above the current 40 percent upper cap.
The Financial Supervisory Service (FSS), a market watchdog, summoned executives of lending businesses on Tuesday to emphasize the authority’s guidelines fixing the highest rate limit at 34.9 percent.
A bill to extend the Corporate Restructuring Promotion Act is also being held back by lawmakers. The act, scheduled to be eliminated this year, requires creditors to help businesses through financing. Without the act, struggling businesses will have to undergo court receivership.
The FSC and FSS have been working together to examine the fiscal capabilities of the country’s major businesses. The FSS will announce a list of companies that need assistance programs today. However, the announcement is ineffective without the passage of the bill.
“As for revising the Capital Market Act, [aimed at listing the Korea Exchange as a holding company on the market] the bill is still far from legislation despite the agreement by all related parties, which makes me feel frustrated,” Yim said.
BY SONG SU-HYUN [firstname.lastname@example.org]