Banks blamed for cronyism
By Kim Tong-hyung
President Lee Myung-bak faces fresh accusations of cronyism after a local media survey found banks packing their outside director positions with those close to him.
A report by the Seoul Economic Daily, a sister paper of The Korea Times, showed that 73 of the 207 newly appointed outside directors by the country’s 18 commercial banks during the four-plus years of the Lee administration could be listed as his friends or supporters.
Seven of them, including Woori Bank outside director Lee Gwi-nam, were formerly high-ranked presidential aides or part of the Cheong Wa Dae staff. Hana Bank outside director Choi Gyeong-gyu was among those ``parachuted’’ in from the prime minister’s office.
Korea University Professor Lee Man-woo, who is an outside director for the Nonghyup Financial Group, was a presidential advisor for economic policies.
Former finance minister Lee Yong-man, now an outside director for Woori Financial Group, Woori Bank’s parent company, was a key member of the President’s election camp.
Seoul National University professor Shin Hee-taek, a Woori Financial outside director, Changwon University professor Park Yeong-geun, with Kyongnam Bank, and Yonsei University professor Park Jin-geun, with Korea Exchange Bank (KEB), have worked with Lee as campaign advisors or members of the inauguration preparation committee.
Six of the outside directors were either members or former members of the ruling Saenuri Party.
Critics wonder whether the bias toward supporters of Lee among those serving as outside directors at banks means there is a massive hole in the country’s monitoring system for financial companies.
Another concern, they say, is that banks are also picking retiring bureaucrats from regulators such as the Financial Supervisory Service (FSS) and the Fair Trade Commission (FTC), apparently looking to have them as ``insurance.’’
Former FSS director Lee Yong-geun is an outside director for Woori Bank, while KB Financial outside director Goh Seung-eui was with the FTC.