Bank hacking spree raises stakes for upcoming CEO reshuffle
From left are KB Kookmin Bank CEO Lee Hwan-ju, Shinhan Bank CEO Jung Sang-hyuk, Hana Bank CEO Lee Ho-seoung, Woori Bank CEO Jung Jin-wan and NH NongHyup Bank CEO Kang Tae-young. Korea Times file
CEOs face possible summons as witnesses at upcoming parliamentary audit
A recent wave of cyberattacks on local banks is raising the stakes for an upcoming CEO reshuffle, with the heads of the country's five major lenders all set to see their terms expire at the end of the year, industry officials said Tuesday.
The incidents, some of which involved artificial intelligence (AI), are expected to put banks' cybersecurity measures under greater scrutiny during this month's parliamentary audit and weigh on decisions over whether to reappoint incumbent chiefs.
Rep. Park Sang-hyuk, a ruling Democratic Party of Korea lawmaker and secretary of the National Assembly's National Policy Committee, said he would seek to summon the heads of the five major commercial banks — KB Kookmin, Shinhan, Hana, Woori and NH NongHyup — as witnesses to determine the causes of repeated data leaks.
The deadline for selecting witnesses for the Financial Services Commission audit on Thursday has already passed, making it more likely that bank CEOs could be called during the Financial Supervisory Service (FSS) audit on Oct. 17 or the committee's final audit session on Oct. 22.
In particular, the CEOs of the three lenders affected by recent breaches — Lee Hwan-ju of KB Kookmin Bank, Jung Sang-hyuk of Shinhan Bank and Lee Ho-seong of Hana Bank — are expected to face more pressure to appear at the audits.
The string of breaches began with Shinhan Bank, which disclosed a suspected AI-related data breach on Thursday affecting about 25,000 customers. The exposed information included names, phone numbers, annual income and loan limits.
KB Kookmin and Hana subsequently reported breaches of customer information, while BNK Busan Bank said personal information belonging to 11 outsourced workers had been exposed. Woori Bank and NH NongHyup Bank also reported hacking attempts, although no data leaks were confirmed.
The incidents could fuel questions over bank CEOs' responsibility for cybersecurity and potentially weigh on their reappointment prospects.
ATMs belonging to major commercial banks are seen at a building in Seoul, Monday. Yonhap
Financial regulators have already been calling for more transparent and independent leadership selection processes, warning against appointments based on personal ties.
During a meeting with chairmen of major financial holding firms on Sept. 23, FSS Gov. Lee Chan-jin urged them to "ensure greater transparency in CEO appointments and avoid selections based on factional ties or personal relationships."
"We are closely watching the situation as the hacking incidents have drawn wide public attention ahead of the parliamentary audit. It remains uncertain whether the heads of financial holding companies or bank CEOs will be selected as witnesses," a banking industry official said.
President Lee Jae Myung on Tuesday ordered government officials to swiftly determine the cause of the hacking incidents.
"Some of the hacking incidents show signs of the use of AI, raising significant public concern and anxiety. We should swiftly and clearly determine what happened and concentrate personnel and resources on minimizing the damage," he said during a Cabinet meeting.
The remarks came hours after police formally launched a probe into the cyberattacks, with the National Office of Investigation forming a 28-member task force to investigate possible violations of the Information and Communications Network Act.