Financial groups opt for stable leadership in CEO appointment

Shinhan Bank CEO Jin Ok-dong / Courtesy of Shinhan Bank

Shinhan and KB reappoint most CEOs of their key affiliates with new terms

By Anna J. Park

Shinhan Financial Group has chosen a path of leadership stability for the next couple of years, after reappointing 11 incumbent CEOs out of its 14 affiliates to continue in their positions for one or two year terms.

The group said Friday that top management, including Chairman Cho Yong-byoung, had decided that the 11 would keep their posts at least for the next year. Out of them, Shinhan Bank CEO Jin Ok-dong and Shinhan Card CEO Lim Young-jin, who head the two key affiliates of the financial giant, were given two-year terms.

Usually, financial firms here give CEOs a two-year term, followed by a one-year term if they have been successful managers. The group explained that the two-year term will allow Jin and Lim to promote mid- to long-term strategies amid the market uncertainties and fast-changing environment in the financial sector.

“CEOs reappointed for just one year tend to focus on short-term goals, rather than mid- to long-term strategies. With the two-year term, Jin and Lim will have enough time to exercise and strengthen responsible leadership,” an official of the group said.

Shinhan said that CEOs who demonstrated excellent leadership in digital transformation and business portfolio diversification were chosen to continue their leadership. If confirmed later this month, the CEOs will continue at their posts starting at the beginning of next year.

KB Financial Group also announced a list of CEOs for its 10 affiliates whose chiefs' terms end this year.

Out of the ten, affiliates including KB Securities, KB Kookmin Card, KB Capital and KB Life Insurance will probably see the same leader retained for next year, while the top positions at KB Insurance, KB Real Estate Trust and KB Credit Information will be filled with new CEOs.

The recommended candidates will be confirmed to lead the affiliates later this month, after a vote at a shareholders meeting. The group explained that its CEO recommendations were based on proven capabilities to continue sustainable and stable growth for the group in the coming years.

The reappointment of KB Securities' incumbent co-CEOs ― Park Jeong-rim and Kim Seong-hyun ― for another year was unexpected, as Park received a reprimand from the Financial Supervisory Service (FSS) last month for his responsibility in failing to curb the mis-selling of problematic Lime funds. The financial watchdog's punishment was considered severe, although not-binding, and its final confirmation will be made at a Financial Services Commission committee meeting later this month.

“In an environment where digital trends and a low growth structure have become the norm, the recommendation committee selected CEO candidates based on their proven track records who can produce sustainable growth,” KB group's recommendation committee said, adding that the incumbents' achievements during their terms, including execution of long-term strategies and flexible leadership skills were all considered.

Meanwhile, Woori Financial Group announced four new CEO candidates to head Woori Card, Aju Capital, Woori FIS and Woori Finance Research Institute.

Kim Jung-ki, current head of the Business Department at Woori Card, was recommended to lead the card arm of the financial group from next year, while Park Kyoung-hoon, CFO and vice president at Woori Financial Group, was tapped to head Aju Capital.

“Through organizational restructuring, the financial group aims to maximize its digital competitiveness and ESG management, while creating synergy among affiliates and strengthening brand value,” a group official said.