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FSS Gov. Lee says Woori chairman should finish term despite loan scandal

Published: 19 Feb. 2025, 16:40

SHIN HA-NEE
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Financial Supervisory Service Gov. Lee Bok-hyun speaks during a meeting with chief executives of banks at the Korea Federation of Banks in central Seoul on Feb. 19. [NEWS1]

Korea’s chief financial watchdog urged Woori Financial Group Chairman Yim Jong-yong to serve out the remainder of his term in order to carry out reforms, despite having strongly criticized his management after a high-profile loan scandal last year.

“A sudden departure of Chairman Yim could cause a major issue regarding governance, considering existing internal factional conflicts within Woori Bank and the shaken internal control system,” Financial Supervisory Service (FSS) Gov. Lee Bok-hyun told reporters after attending a meeting with chief executives of banks on Wednesday.

Woori Financial Group, the fourth-largest financial group in Korea, found itself in hot water after the FSS uncovered an illicit loan scandal involving former Woori Chairman Son Tae-seung in August of last year. In November, the regulator raided the offices of Yim and then-CEO Cho Byung-kyu, who later stepped down amid the allegations, while the governor also repeatedly slammed Woori’s management for weak internal control.

Lee, nevertheless, urged stable leadership, saying, “I believe that Yim should get the situation sorted out.”

Yim took the helm of Woori Financial Group in March 2023, and his term will end in March next year.

But the governor stressed that the FSS would carry out its ongoing inspection of Woori Financial Group with strict scrutiny regardless.

Lee also called for monetary easing ahead of the Bank of Korea’s rate-setting decision, which is slated for Feb. 25.

“I believe there is a consensus within financial authorities, and within society, that relatively dovish monetary policy is desirable given the economic situations involving inflation, foreign exchange rates, domestic demand and growth,” Lee said.

During the meeting with bank CEOs, the governor once again highlighted the need for stricter internal control.

“I have witnessed major financial incidents involving senior executives breaking out repeatedly, even until recently, and realized how difficult it is to achieve qualitative improvement,” Lee said, asking the bank chiefs to undertake a bold overhaul of their corporate culture and bolster internal control systems.

BY SHIN HA-NEE [[email protected]]