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Woori chairman likely to avoid heavy sanctions

Woori Financial Group Chairman Son Tae-seung / Courtesy of Woori Financial GroupBy Park Jae-hyukThe Financial Supervisory Service (FSS) may readjust its punishment of Woori Financial Group Chairman Son Tae-seung ― which the regulator had already given him pre-notification of ― regarding his failure to prevent Woori Bank's mis-selling of Lime Asset Management funds that caused huge losses for investors last year.It was initially planning to suspend Son from work, which would mean he would be prohibited from working for any financial company for five years.However, the financial overseer has apparently taken into account Woori Bank's efforts to compensate the investors as a mitigating factor.Representatives from the FSS' financial consumer protection department will attend a final hearing to determine the specifics of sanctions on the bank, Thursday, and express their opinions on the bank's efforts, said sources familiar with the issue. Woori Bank agreed last year to return the principal to those who invested in Lime's Pluto TF-1 fund.It is also expected to accept the latest FSS recomm

Feb 24, 2021By Park Jae-hyuk
Woori chairman likely to avoid heavy sanctions

Hyundai Card launched 'MX BOOST' credit cards

Image captured from Hyundai Card's website / Courtesy of Hyundai Card By Anna J. ParkHyundai Card has released a new line of credit cards called “MX BOOST” in January featuring upgrades to benefits and services offered by the Hyundai Card M and Hyundai Card X credit cards already in use.The “MX BOOST” cards come in six different types ― M1 BOOST, M2 BOOST, M3 BOOST, X1 BOOST, X2 BOOST and X3 BOOST ― and each of these cards offers differentiated cash-back benefits and services with different annual fees. “Hyundai Card aims to offer differentiated characters to the MX BOOST selection, while maintaining the original M and X series,” a Hyundai Card official said. The new credit cards also offer improved digital payment options through close cooperation with seven online payment businesses, including Kakao Pay, Naver Pay and Samsung Pay. The MX BOOST also offers expanded rewards when used at affiliated stores overseas. For instance, M1 BOOST, M2 BOOST and M3 BOOST card h

Feb 23, 2021By Anna J. Park
Hyundai Card launched 'MX BOOST' credit cards

Toss app operator faces lawsuit for fraudulent ads

A pedestrian passes by Viva Republica's head office in Seoul in this 2019 file photo. YonhapBy Park Jae-hyukHundreds of users of the Toss mobile money transfer app are preparing for a lawsuit against its operator Viva Republica, alleging the fintech firm advertised fraudulent investment products that caused them huge losses.Most of them invested in real estate through the Terafunding peer-to-peer (P2P) lending platform, after seeing its ads on Toss. The P2P platform provider has deferred redemption of funds because the borrowers are in default.The investors blamed their losses on both Terafunding and Viva Republica, saying the ads on Toss downplayed the risk of losing their principal. They opened a website recently to share information and prepare the lawsuits against the two companies.After filing a petition with Cheong Wa Dae and the Financial Supervisory Service (FSS), they are also calling for the financial authorities to deprive Viva Republica of its licenses to operate an internet-only bank and a securities firm, unless the company fulfills its responsibilities.“The compa

Feb 23, 2021By Park Jae-hyuk
Toss app operator faces lawsuit for fraudulent ads

NongHyup in quandary over dividend policy

NongHyup Financial Group Chairman Son Byung-hwan speaks during its management strategy meeting at its headquarters in Seoul, Feb. 3. YonhapBy Lee Min-hyungNongHyup (NH) Financial Group is trying to decide on whether to reduce its dividend offerings, as financial watchdogs ratchet up pressure on the firm to maintain financial soundness by scaling down its profit returns amid the pandemic uncertainty.In 2020, the group paid dividends worth 500 billion won ($450.7 million) to its sole shareholder ― the National Agricultural Cooperative Federation (NACF). NH's dividend payout ratio last year reached 28 percent.But it remains unclear whether the company will be able to keep a similar level of dividend offerings this year, as other commercial banking groups are cutting their rates down to around 20 percent amid authorities' growing pressure. The Financial Supervisory Service (FSS) recommends major financial holding firms here provide no more than 20 percent of their net incomes to shareholders for dividends.KB Financial Group and Hana Financial Group decided recently to abide by the FSS gu

Feb 22, 2021By Lee Min-hyung
NongHyup in quandary over dividend policy

Korean financial leaders promoting ESG amid fears of stock declines

Financial Services Commission Chairman Eun Sung-soo, center on the right side, holds a conference with leaders of the nation's top five financial holding firms at the Korea Federation of Banks headquarters in Seoul on Feb. 16. YonhapBy Lee Min-hyungThe leaders of Korea's major financial holding firms will keep scaling up investments in environmental, social and corporate governance (ESG), identifying it as the most effective way to hedge against possible stock price declines, industry sources said Wednesday.The outbreak of the coronavirus pandemic last year sparked a worldwide boom for investments to make their businesses more environmentally friendly and socially responsible. Starting in the latter half of 2020, Korean lenders and their holding firms began making aggressive investments into such goals by issuing a series of ESG bonds and pledging to go carbon-neutral.The trend will pick up steam throughout 2021, as global investors are calling on Korean firms to fulfill their ESG pledges and generate more tangible outcomes this year.This, however, is adding pressure to the top manag

Feb 22, 2021By Lee Min-hyung
Korean financial leaders promoting ESG amid fears of stock declines

IBK likely to appoint union-backed outside director

Industrial Bank of Korea CEO Yoon Jong-won / Korea Times fileBy Lee Kyung-min Industrial Bank of Korea (IBK) may end up having at least one outside director recommended by its labor union, an easier task since the state-run lender has greater discretion in the appointment of such figures unlike their commercial counterparts that need approval from shareholders. The labor-backed outside director will be able to serve in the same capacity as executive directors, deeply involved in overall corporate management including budget planning, revisions of rules and discretion over asset transactions.KB Financial Group's union recommended two figures with expertise in environmental, social and corporate governance (ESG) to be appointed as outside directors. But the attempt, which was the union's third, was voted down at the group's shareholders' meeting, Nov. 20, 2020.This was because the recommendation failed to meet the requirement of a majority support following the attendance of holders of over a quarter of the number of the firm's voting shares.The move by IBK's union is in line with atte

Feb 21, 2021By Lee Kyung-min
IBK likely to appoint union-backed outside director

Will Citibank Korea be sold off?

Citibank Korea CEO Yoo Myung-soon / Korea TimesBy Lee Kyung-min There is mounting speculation over Citibank Korea being sold off following reports claiming that the new CEO of the lender's head office in the U.S. is considering slimming down its global consumer banking operations. New Citigroup CEO Jane Fraser is known for her focus on retail banking and credit card operations when she managed the firm's business in Latin America.Such prospects could test the leadership and business acumen of Citibank Korea's new CEO, Yoo Myung-soon, whose priorities are “maximizing differentiating qualities” from competitors to become a market leader.Also pressuring Yoo, who began her three-year term in October 2020, is the lender's lackluster earnings performance over the past few months. Citibank Korea saw its net profit during the first nine months of last year decline 38 percent year-on-year to 161.1 billion won ($145.5 million). “As our incoming CEO Jane Fraser said in January, we are undertaking a dispassionate and thorough review of our strategy, including our mix of bu

Feb 21, 2021By Lee Kyung-min
Will Citibank Korea be sold off?

Korean banks try to maintain expansion momentum in Southeast Asia despite Myanmar coup

Officials from KB Kookmin Bank and Myanmar's government hold an opening ceremony for KB Bank Myanmar in Yangon on Jan. 27. Courtesy of KB Kookmin BankBy Lee Min-hyungKorea's commercial lenders are changing their expansion strategies in the Asian market to focus on boosting their presence in a few key markets as uncertainties mount in the wake of the military coup in Myanmar.Several Korean private and state-owned lenders, including the Korea Development Bank (KDB) and KB Kookmin Bank, opened new offices in Myanmar in January this year, hoping to expand their presence in what they view as a “strategic geographical region” of the Association of Southeast Asian Nations (ASEAN).But persistent corruption, lack of transparency and a disastrous human rights record in recent years continue to plague the Southeast Asian country. Yet many foreign investors still believe in the vast growth potential of the ASEAN region from a mid to long-term perspective. Several companies have already announced they will be halting operations in Myanmar or even terminating relationships with the gov

Feb 21, 2021By Lee Min-hyung
Korean banks try to maintain expansion momentum in Southeast Asia despite Myanmar coup

BNP Paribas Cardif, Chubb, ABL, MetLife losing customers here

GettyimagesbankBy Park Jae-hyukMid-tier foreign life insurance companies appear to be losing their customers here, in contrast to their Korean peers, which have successfully prevented their clients from terminating their insurance contracts despite the COVID-19 pandemic.Data compiled by the Korea Life Insurance Association showed Friday that the combined size of terminated insurance contracts with four foreign life insurers here increased from a year earlier, due to lapses and surrenders during the first 11 months of last year.These data can be interpreted as resulting from a rise in the number of customers surrendering insurance policies without paying insurance premiums for a certain period of time.In particular, the size of cancelled contracts with BNP Paribas Cardif Life Insurance over lapses and surrenders, jumped to 648.9 billion won ($585 million), up 88.6 percent from 344.1 billion won a year earlier.Chubb Life Insurance Korea's cancelled contract amount also rose 19.7 percent to 1 trillion won, from 843.7 billion won. Cancelled contract amounts of ABL Life Insurance and MetL

Feb 19, 2021By Park Jae-hyuk
BNP Paribas Cardif, Chubb, ABL, MetLife losing customers here
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