Debate Over Equity in Win-Win Finance Plan Causes Controversy

Controversy over ‘equity’ emerges during the win-win finance plan

Although domestic banks have prepared a financial support plan worth over 2 trillion won in response to the ‘win-win finance’ promoted by the financial authorities, a ‘debate for equity’ is likely to arise. This is because the ‘win-win finance’ scheme prepared by banks focuses only on supporting small business owners and has no support measures for the remaining vulnerable groups.

Banks are in trouble. If this debate arises while the outlook for the banking industry is not bright for the next year, additional measures may eventually need to be prepared.

On the 21st, 20 domestic banks prepared a plan to support people’s livelihood finance, investing at least 2 trillion won. The key is to repay some of the interest to small business owners who took out high interest loans. The banking sector believes this support scheme will benefit around 1.87 million small business owners and self-employed people.

Customers complain about this on the front line in banks. This is because the economic slowdown not only affects small business owners and the self-employed, but support measures have been put in place just for them.

An official at a bank branch said, “After hearing the news that some of the interest would be reduced and paid in cash to self-employed people and small business owners, some customers asked, ‘Why don’t I get the interest back?’ ” and added, “This fairness debate is expected to expand further.” “he said.

Banks were in a difficult position. Each bank spent up to hundreds of billions of won money to prepare support measures, but if this equity dispute arises, pressure to formulate additional measures that can cover all other financially vulnerable groups could increase.

A bank official said, “The reason why the win-win financial plan is focused on small business owners and the self-employed was triggered by the president’s comment in a meeting with small business owners and self-employed people that they serve as servants. to banks.” He added, “The core of public criticism towards banks is. “It is an interest business, and as the amount of interest paid by households is significant, we are concerned whether support measures should be prepared for individual borrowers.”

Some banks are also slowly starting to recognize that this equity debate is emerging and are considering countermeasures. This is a plan as a more active implementation of the debt modification program for vulnerable borrowers that each bank maintains in cooperation with the Korea Inclusive Finance Agency.

Another bank official said, “Personal debt modification programs such as interest repayment deferral and maturity extension are already in place for vulnerable borrowers,” but added, “Even if it is not a new support scheme, there is adequate support is possible with the current program.” He said.

However, “If controversy about fairness arises, it could lead to pressure for additional measures,” he said. the interest burden on vulnerable borrowers.” he added.

Bank of Korea creates ‘smart economy’ with Naver

On the 22nd, Bank of Korea signed a business agreement with Naver for digital technology cooperation.

The purpose is to expand the scope of AI use to the financial and economic sectors by combining Bank of Korea’s expertise in the financial and economic fields and Naver’s IT technology capabilities.

According to this agreement, Naver decided to expand public services, such as upgrading the data search function of the Bank of Korea website and statistics in its own AI service, ‘HyperclovaX’.

In addition, we will also explore ways to apply digital technologies such as big data, Internet of Things, and cloud to Bank of Korea’s business.

Bank of Korea Governor Lee Chang-yong said, “As the transition to a digital economy accelerates due to recent remarkable advances in digital technology, Naver’s IT technology will be able to further strengthen Bank of Korea’s policy and research capabilities and improve quality. of his service to the public.” “It is,” he said.

Bank of Korea Governor Lee Chang-yong (pictured right) and Naver CEO Choi Soo-yeon take a commemorative photo after signing a business agreement. /Photo = Provided by Bank of Korea

Saemaul Geumgo restores trust with a new chairman

The Saemaul Geumgo Federation, which had suffered from problems such as PF real estate (project financing) and employee misconduct, welcomed a new leader.

The Saemaul Geumgo Federation announced on the 21st that Kim In, chairman of Namdaemun Saemaul Geumgo, was elected as the next chairman as a result of the election for the 19th Chairman of Saemaul Geumgo.

Chairman Kim In, who has just started his term, plans to make restoring customer trust his top priority.

Chairman Kim In said, “We apologize for the inconvenience caused to our customers due to recent concerns about Saemaul Geumgo. We have a great sense of responsibility and will do our best to ensure that Saemaul Geumgo innovates, restores the trust of the public, and is being reborn. as a real low-income financial institution.” “We will do our best,” he said.

The Chairman of the Geumgo Saemaul Federation, Kim In (on the right of the photo) takes a commemorative photo immediately after being elected. /Photo = Provided by the Saemaul Geumgo Federation

DGB Financial, recommended by external directors and shareholders

DGB Financial Group will receive recommendations for external directors from shareholders again this year. This system was introduced in 2018, but is expected to be used more actively following recent recommendations from financial authorities to improve governance.

DGB Financial Group allowed shareholders holding more than one share of voting stock by December 15 this year to recommend one preliminary candidate per person.

However, potential candidates must have expertise in the following areas: finance, economics, management, accounting and finance, law, IT and digital, human resources (HR), risk management, ESG, and financial consumer protection. In addition, it must not fall under any of the disqualifications set out in the ‘Act on the Governance of Financial Companies’.

DGB Financial Group said, “The preliminary recommended candidates will be selected and managed as an integrated candidate group through internal procedures, including evaluation by the external selection advisory committee, in February next year.”

Meanwhile, among the seven external directors of DGB Financial Group, the terms of external directors Kang-rae Cho, Seung-cheon Lee, and Hyo-sin Kim will expire at the regular general shareholders’ meeting in March next year.

‘Hot and New Financial’is a weekend corner of the Bizwatch Economic Section that summarizes new financial products introduced during the week and notable moves by financial companies such as banks, insurance, and credit cards. [편집자]

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