“The appointment of a financial company chairman must be transparent…Regular communication with the board of directors”
“Token Securities supervisory guidance during this month… New Year work plan press conference
Lee Bok-hyeon, the head of the Financial Supervisory Service, argued on the 6th that the banking sector can reap tens of trillions of annual interest earnings, saying, “The fruits need to be shared with society, saying that the oligopoly system has a privileged position that is guaranteed.”
Director Lee held a press conference to explain the FSS 2023 work plan at the headquarters in Yeouido on this day, and responded to the point that the banking sector is holding a party based on performance.
Director Lee said, “There is no disagreement that a bank has the basic characteristics of a profit-seeking company.” We need to think about the fact that we have a fundamental role to play.”
“In order to pay a lot of dividends, we need to reduce the proportion of risk-weighted assets, so it becomes impossible to provide credit to low and medium credit borrowers in difficult times like now,” he said.
According to the financial sector and Yonhap Infomax the previous day, the average net profit (consensus) of the four major financial holding companies (KB, Shinhan, Hana, and Woori) last year was 16.5557 trillion won in total, up 13.8 from 2021. % expected to increase. This is the biggest profit ever.
![A bank in downtown Seoul. [연합뉴스 자료사진]](https://www.jeonmae.co.kr/news/photo/202302/939069_629657_3742.jpg)
As a result, the amount of incentive pay for bank employees has also increased.
Hana Bank recently set 350% of the basic salary as a special profit-linked bonus through collective bargaining agreements. It is 50 percentage points (p) higher than the 300% of the basic salary in 2021.
Hana Bank paid 250% in advance at the end of last month, and will pay an additional 100% in April.
Previously, Shinhan Bank set a base salary of 361% and NH Nonghyup Bank set a base salary of 400% as management incentives. KB Kookmin Bank paid 3.4 million won in special incentives to 280% of the basic salary.
Woori Bank is currently negotiating wages and collective bargaining. In 2021, Woori Bank gave 300% of the basic salary by adding 200% of the basic salary and 100% of the basic salary in the name of morale boosting in the name of management performance pay, and paid an additional 1 million won.
Regarding this, Lee made it clear that it is inappropriate for high-ranking executives of financial companies to receive high performance bonuses of hundreds of millions of won money or more.
Director Lee said, “It will be difficult to get a public consensus that the performance pay of some senior executives has earned at least hundreds of millions of money in these difficult times.” We need to consider such a structural approach before giving him credit.”
He also reaffirmed the current situation that there is a need to improve the governance structure of financial holding companies and improve the transparency of the executive appointment process. He announced his plan to strengthen direct communication with the board of directors of financial companies.
Director Lee said, “Given the importance and scope of work of financial holding companies in the national economy, there is a critical thought that the procedure for selecting a chairman candidate takes place inside a black box, and the authorities sympathize with it .” As it becomes a problem as it loses, it would be necessary to institutionalize the part that should be institutionalized by giving it more publicity.”
“We will institutionalize and regulate communication with the board of directors of financial companies,” he said.
[전국매일신문] Correspondent Hong Sang-soo
HongSS@jeonmae.co.kr
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