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.
Watchdog mitigates penalty on Shinhan leader
From left are Shinhan Financial Group Chairman Cho Yong-byoung and Shinhan Bank CEO Jin Ok-dong. Courtesy of each firm
By Lee Min-hyung
By Lee Min-hyung
The Financial Supervisory Service (FSS) decided not to impose a heavy punishment on Shinhan Bank CEO Jin Ok-dong for his alleged lapse in supervising the sale of fund products linked to Lime Asset Management, removing risks surrounding Shinhan Financial Group's top management.
The regulator decided Thursday to lower the level of sanctions on Jin to a “cautionary warning.” This decision allows the leader of the bank to extend his term once again or to become the group's next chairperson.
In its advance notice, the FSS slapped Jin with a reprimand, holding him responsible for the poor supervision of the lender's sales of troubled Lime fund products. The lender's Lime fund sales totaled 276.9 billion won ($247.3 million).
But the regulator mitigated the sanctions level after taking into consideration Shinhan's efforts to protect its customers following the debacle. Earlier this week, the FSS's dispute settlement committee recommended Shinhan to compensate a maximum of 80 percent of customers' losses involving Lime investments that went sour, and Shinhan accepted the recommendation.
The FSS also decided to reduce sanctions on Shinhan Financial Group Chairman Cho Yong-byoung. Cho received a cautionary warning in the FSS' advance notice. But it was mitigated to the lightest out of the five-tier sanction system.
“We respect the results of the FSS' sanctions committee,” an official from Shinhan Bank said. “We are going to keep coming up with diverse measures to protect customers' rights and push for customer-oriented management.”
The FSS' recent decision, however, still needs to undergo a final confirmation vote by the Financial Services Commission.
On Friday, Shinhan Financial Group also announced record-high quarterly earnings.
The group said first-quarter net profits rose 27.8 percent year-on-year to 1.19 trillion won, thanks to the balanced growth of its banking and non-banking businesses.