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Lee Kyung-min

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Economy

New FSS chief warns of 'perfect storm' amid lingering financial risks

Financial Supervisory Service Governor Jeong Eun-bo arrives at the FSS headquarters in Yeouido, Seoul, Friday. YonhapBy Lee Kyung-min Korea should brace itself for a “perfect storm” of the economy spiraling out of control due to a mixture of financial risks from corporate and individual insolvencies and asset price bubbles brought on and exacerbated by the pandemic-triggered expansionary government policies, the country's top financial supervisor said Friday. Financial Supervisory Service Governor Jeong Eun-bo said that the economic and financial conditions are far from warranting a drawdown in emergency relief packages with the recovery in the real economy still being distant, a challenge compounded by the need to curb the rapid rise in debt in the private sector. “The COVID-19 pandemic has yet to be overcome,” Jeong said at his inauguration ceremony in the FSS headquarters in Yeouido, Seoul.Excessive liquidity in the market pumped in as part of quantitative easing and low-interest rates around the world are emerging as new risk factors in the financial marke

Aug 6, 2021By Lee Kyung-min
New FSS chief warns of 'perfect storm' amid lingering financial risks
Tech & Science

ANALYSIS Kakao criticized for sprawling business expansion

Kakao founder Kim Beom-su / Korea Times fileNo. of IT giant's affiliates quadruples in 7 years By Lee Kyung-min Kakao Corp, the nation's internet giant and operator of Korea's most popular messenger app Kakao Talk, has come under fire for its sprawling expansion into over 100 different businesses by capitalizing on its dominant customer base, which many believe is driving smaller players up against the wall. The IT firm was supposedly created to foster healthy competition and reduce the immense influence of Korea's major conglomerates, but it is well on its way to joining their ranks, with the same profit motives and at the expense of small market players, some say.According to the Fair Trade Commission, the number of Kakao's affiliates totaled 118, quadrupling from 26 in 2014. This is the second-largest number of affiliates after SK Group.The net worth of Korea's richest man, Kakao founder Kim Beom-su, is over 15.4 trillion won ($13.4 billion). The corporation's annual sales hit a record high of over 4.15 trillion won last year. The KOSPI-listed firm has the third-largest market cap

Aug 5, 2021By Lee Kyung-min
[ANALYSIS] Kakao criticized for sprawling business expansion
Economy

Deloitte Consulting Korea appoints new vice president

Chung Hyun-sukBy Lee Kyung-min Deloitte Consulting Korea announced Thursday that it has appointed human resources consulting expert Chung Hyun-suk as vice president, and that he will also lead its human capital department.“The appointment is to provide a variety of services so that our corporate culture is defined by employees' agile innovation capabilities,” the firm said.“We also plan to become a consulting firm that leads in the human capital consulting services.”Chung graduated from Korea and Arizona State universities before starting work at Hanwha General Insurance, followed by PricewaterhouseCoopers Consulting, Mercer Korea and the Hay Group.He is an expert in organizational management and human capital consulting. While leading Korn Ferry Consulting's Korea office, his clients included LG and Shinhan Financial groups. He plans to lead the firm by focusing on digitization and human resources innovation.Deloitte Consulting plans to expand the scope of its services to include strategy, and mergers and acquisitions, while strengthening organizational

Aug 5, 2021By Lee Kyung-min
Deloitte Consulting Korea appoints new vice president
Economy

Hawkish Bank of Korea set to raise key rate this month

Bank of Korea Governor Lee Ju-yeol / Korea Times fileBy Lee Kyung-min The Bank of Korea (BOK) is increasingly tilting toward raising the key policy rate as early as this month, as inferred by its July 15 meeting minutes which showed that five out of the six members of its rate-setting monetary policy board were in agreement over the need to place greater emphasis on monetary policy normalization for financial stability.The next meeting is scheduled for Aug. 26, to be followed by one for Oct. 12 and for Nov. 25. The central bank is in a tighter bind over whether the financial imbalance defined by rising consumer prices and snowballing household debt should be mitigated by the earlier-than-expected rate hike, an argument weakened by growing voices of concern over the continued spread of the coronavirus Delta variant hampering economic recovery. In a 5-1 decision, the board decided to leave the policy rate at an all-time low of 0.5 percent at its July 15 meeting. But minority opinion was expressed by Koh Seung-beom, who called for an increase of 25 basis points, citing uncontrollable sh

Aug 4, 2021By Lee Kyung-min
Hawkish Bank of Korea set to raise key rate this month
Tech & Science

Cooperation for digitization

KT CEO Ku Hyeon-mo, left, and Industrial Bank of Korea CEO Yoon Jong-won hold a signed memorandum of understanding, Wednesday. The two will cooperate in fostering firms with innovative and digitally oriented business models. Courtesy of KT

Aug 4, 2021By Lee Kyung-min
Cooperation for digitization
Banking & Finance

K bank reports first-ever quarterly profit

By Lee Kyung-min K bank is on track to improve its financial fundamentals ahead of its planned initial public offering (IPO) possibly set for 2023 at the earliest. The internet-only bank achieved its first quarterly profit in the April-June period since it was launched in 2017. In a regulatory filing Tuesday, K bank said that its net profit during the second quarter of this year reached 3.9 billion won ($3.3 million).Chief among its growth drivers was a sharp increase in the number of customers and a consequent rise in the amount of deposits, which helped the internet-only bank borrow at a lower cost. For the first six months of this year, cumulative net losses were reduced to 8.4 billion won, only a fifth of the 44.9 billion won in net losses it suffered during the same period of 2020.The number of bank customers exceeded 6.19 million during the January-June period, up over 26 times year-on-year. As of July, the number stood at 6.28 million. During the first half of this year, the bank had a total of 11.29 trillion won in deposit accounts, up by 7.54 trillion won from six month

Aug 3, 2021By Lee Kyung-min
K bank reports first-ever quarterly profit
Economy

Bithumb fraud investigation expands

In this file photo, the Bitcoin logo appears on the display screen of a cryptocurrency ATM, last week. AP-YonhapBy Lee Kyung-min Korea's cryptocurrency exchange Bithumb is coming under heavy criticism over its alleged mismanagement and questionable business dealings, as evidenced by expanding police and prosecution investigations into key figures related to digital asset investments. Seoul Metropolitan Police Agency said Monday that an investigation is underway into BK Medical Group Aesthetic Clinic CEO Kim Byung-gun and the exchange's de facto owner Lee Jeong-hoon, who already faces fraud charges involving more than 112 billion won ($100 million). Lee is the former chairman of Bithumb Korea and Bithumb Holdings.The investigation that began in mid-July is separate from an earlier fraud charge filed by the Seoul Central District Prosecutors' Office, which indicted Lee without detention for defrauding Kim out of $100 million for a down payment in what later became a failed equity sale of Bithumb stakes. Kim was cleared of the charges at the time because prosecutors concluded that he wa

Aug 2, 2021By Lee Kyung-min
Bithumb fraud investigation expands
Banking & Finance

Banks shuttering branches despite FSS warnings

A man passes by ATMs in Seoul. Korea Times fileBy Lee Kyung-min Major commercial banks plan to reduce the number of branches by at least 100 in the second half of this year, despite recommendations from the Financial Supervisory Service (FSS) against doing so.The COVID-19 pandemic has prompted more and more customers to handle most of their transactions online, prompting banks to feel increasingly reluctant to spend money on maintaining a large number of offline branches.But financial authorities appear to be against the rapid closures of a large number of bank branches.Former FSS head Yoon Suk-heun said last July that it is “not desirable to reduce the number of branches in a short period of time.”According to FSS data, the number of branches operated by Korea's top five banks ― Shinhan, KB Kookmin, NongHyup, Woori and Hana ― stood at 4,398 as of March, down 191 from a year ago. In contrast, 96 branches were shuttered from March 2019 to March 2020.After the FSS said it would set up procedural guidelines on branch closures, many lenders hurried to shut down their branches

Jul 31, 2021By Lee Kyung-min
Banks shuttering branches despite FSS warnings
Economy

Fed's dovish stance gives BOK room to maneuver

A screen displays a statement by Federal Reserve Chair Jerome Powell, following the U.S. Federal Reserve's announcement and as traders work on the trading floor at New York Stock Exchange (NYSE) in New York City, Thursday (EST). Reuters-YonhapFed's overnight decision was 'no surprise': BOK By Lee Kyung-min The Bank of Korea (BOK) will have room to maneuver in terms of adjusting its monetary policy, relieved by the Federal Reserve's decision to leave its key policy rate unchanged at 0 to 25 basis points with asset purchase programs intact.The Fed's rate-setting decision and remarks from Fed Chairman Jerome Powell are considered the central considerations that will impact the BOK's rate-setting. Despite the U.S.'s rate freeze, the BOK is still inclined to increase its benchmark policy rate, due to rising inflationary pressures, job losses and snowballing household debt, the combination of which fail to take priority over the U.S. policy action. Senior BOK officials were called in for a hurriedly-arranged meeting to assess impact of the Fed's overnight decision on the country's eco

Jul 29, 2021By Lee Kyung-min
Fed's dovish stance gives BOK room to maneuver
Economy

Gov't desperate to cool overheating real estate market

Deputy Prime Minister and Finance Minister Hong Nam-ki, left, speaks during a press briefing at the Seoul Government Complex, Wednesday. Yonhap'Undeterred panic-driven buying frenzy biggest risk' By Lee Kyung-min The government said Wednesday that steep increase in housing prices over the past few years will experience a deeper-than-expected drop, seeking to deter continued purchase of houses in Seoul and Gyeonggi area.Yet little desired outcome is expected, since investors have learned that attempts to control what should be determined by supply-and-demand only fuels expectations of further price hikes.Hong told a hastily-arranged press briefing that he expects housing prices to fall in the second half of the year, citing assessments by market experts, housing supply plans and tighter borrowing conditions brought on by a strengthened government clampdown of real estate speculation.“The real estate market will experience a price fall sharper than previously thought, given a series of factors including the government's plan to begin generating and recording demand for new housin

Jul 28, 2021By Lee Kyung-min
Gov't desperate to cool overheating real estate market
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