Samsung gives another chance to financial units' CEOs

By Park Jae-hyuk

The top executives of Samsung's financial services subsidiaries have retained their seats in the latest reshuffle, despite the multiple challenges they have faced due to sanctions from financial authorities and the COVID-19 pandemic.

The nation's largest conglomerate's life insurer, non-life insurer, card issuer, brokerage and asset management arms announced Monday they had conducted year-end executive reshuffles.

The five companies decided to leave their chief executives unchanged, as Samsung Electronics did last week, to focus on stabilizing management amid uncertainties caused by the COVID-19 pandemic.

Before the recent reshuffles, industry insiders were wondering whether Samsung Life Insurance CEO Jeon Young-muk would be able to continue leading the company after the Financial Supervisory Service (FSS) imposed heavy sanctions on the life insurer last Thursday for its failure to make full insurance payments to a group of cancer patients.

The punitive measure will last for one year, prohibiting Samsung Life and its subsidiaries ― Samsung Card, Samsung Securities and Samsung Asset Management ― from tapping into new businesses, such as the MyData business which enables financial firms to provide their customer data to a third-party MyData business operator, allowing customers to access all their financial information in one place.

Despite this unfavorable factor, Jeon was allowed to continue serving his remaining one-year term, according to Samsung Life.

This decision is attributed to the company's solid earnings this year. Samsung Life posted an accumulated 25 trillion won ($23 billion) in sales during the first three quarters, up 3.9 percent from a year earlier. Its accumulated operating profit during the period also rose 5.1 percent to 1.2 trillion won.

Samsung Card CEO Kim Dae-hwan and Samsung Asset Management CEO Shim Jong-geuk, both of whom were appointed to their positions in January at the same time as the Samsung Life CEO, are also likely to remain in their offices to ensure stable management. However, a Samsung Card official said it is yet to be ascertained whether Kim will be promoted to president from vice president at this time.

Samsung Fire & Marine Insurance CEO Choi Young-moo and Samsung Securities CEO Chang Seok-hoon, both of whose terms will end in March, are both expected to get approval to serve another term in the forthcoming meetings of the boards of directors and general shareholders, unless something extraordinary happens.

Choi has been recognized for his stable management over the past three years. He recently led the company to join hands with China's Tencent and set up a joint venture there.

Chang has led the securities firm since July 2018, replacing Koo Sung-hoon as CEO after Koo's company was punished by the financial regulator over the “fat finger” scandal that took place in April that year. Samsung Securities had mistakenly given about 2.8 billion shares to its workers who owned company stocks, instead of 2.8 billion won in dividends.

Chang has enabled the company to achieve satisfactory earnings amid the stock market rally this year by attracting young retail investors, as well as wealthy customers and institutional investors.

Although the CEOs have remained unchanged, the five financial units of Samsung promoted a larger number of executives in the recent reshuffle to appreciate their efforts to cope with the unprecedented difficulties caused by the pandemic.

Samsung Life promoted 15 executives, including Vice President Choi In-cheol, who once worked at the conglomerate's Future Strategy Office until the team was disbanded in 2017.

Samsung Fire promoted 16 executives, including Vice President Lee Doo-yeol, who has worked for the insurer since 1989. Samsung Securities promoted five executives, including Vice President Lee Seung-ho, who joined the brokerage in 1995.

Samsung Card also promoted five executives and Samsung Asset Management promoted one.

The companies said they will complete organizational reforms and appointments of non-executive employees in the near future.