Lee Min-hyung joined The Korea Times in 2014 and has worked as a journalist mainly in Korea’s finance, tech and automotive industry. He specializes in content creation, breaking news and in-depth analysis currently on transportation and mobility. You can reach him via mhlee@koreatimes.co.kr.
IBK pressed to compensate for fund fiasco following Woori's decision
Industrial Bank of Korea CEO Yoon Jong-won speaks during an event to discuss next-generation vehicles industry in Seoul on Feb. 4. Yonhap
By Lee Min-hyung
By Lee Min-hyung
The Industrial Bank of Korea (IBK) is pressed to follow a similar path to Woori Bank which decided Monday to accept a regulator's arbitration result, and pay a sizable amount of compensation for its mis-selling of Lime Asset Management funds.
Woori's decision came weeks after the Financial Supervisory Service (FSS) dispute mediation committee released its own probe on the two banks last month. The recommendation urged the banks to provide compensation of up to 78 percent in principle to victims who had invested in the troubled Lime fund products.
As Woori was the first to accept the request from the watchdog, the state-run lender is also set to accept the arbitration proposal sometime in the near future.
“We have not confirmed whether or when to make the final decision over the arbitration result, but will make it public within this month,” an IBK spokesman said, without elaborating further due to the sensitivity of the issue.
Under the suggestion, Woori will provide about 270 billion won ($236.7 million) for compensation of losses stemming from the mishandling of the fund sales. IBK is expected to make compensation worth 29 billion won.
IBK CEO Yoon Jong-won also pledged recently to abide by any result from a dispute mediation procedure to compensate troubled customers. As Yoon said the bank will “sincerely abide by dispute settlement results” from the FSS' committee, the lender is set to follow in the footsteps of Woori for the Lime fiasco.
Woori Bank held a board of directors meeting, Monday, and decided to abide by the mediation from the FSS' dispute settlement committee.
“We took the preemptive step to regain customers' trust regarding the fund mis-selling,” an official from the lender said. “The board of directors will continue to discuss measures to prevent the recurrence of such cases and enhance customer protection.”