Business - The Korea Times

Samsung Life embroiled in troubled gold-related DLS

Samsung Life Insurance's headquarters in southern Seoul. / Korea Times fileBy Kim Bo-eunInsurers have remained unaffected by the latest series of scandals involving private equity funds (PEFs), as the products were distributed mainly by banks and brokerages. However, Samsung Life Insurance has come under scrutiny after it notified investors of a gold-related derivative-linked securities (DLS) product last week redemptions have been suspended. Samsung Life sold the bulk of the product that incorporated a letter of credit between firms importing and exporting gold as the underlying asset. Redemptions for products that reached maturity at the end of last month were halted after NH Investment & Securities, which drew up the product, notified the insurer of liquidity issues triggered by COVID-19. The investments were managed by the Hong Kong-based Universe Asia Management.Samsung Life notified investors last month that they would be able to redeem their investments that reach maturity at the end of July by May next year, based on the notifications from NH.The issue for Samsung Life as

Aug 6, 2020By Kim Bo-eun

Samsung Life embroiled in troubled gold-related DLS

Banks refraining from sales of risky fund products amid scandals

Members from Korean Finance & Service Workers' Union stage a protest in front of Cheong Wa Dae in Seoul on July 29, urging the presidential office to settle a series of disputes over financial scandals surrounding mis-selling of some risky private equity funds. YonhapBy Lee Min-hyungDomestic commercial banks here are suspending sales of risky financial products ― mostly private equity funds (PEFs) ― amid unceasing scandals surrounding lenders' involvement in the mis-selling of such high-risk, high-return investment funds, officials said Wednesday.Major banks have for years raked in hundreds of billions of won in commissions from sales of PEFs to individual investors. With financial authorities starting to ease regulations in 2015, lenders have been able to sell PEFs to customers at most sales offices. For them, sales of the products were seen as an optimal source of non-interest revenue amid the prolonged economic slowdown.But banks are on track to discontinue sales of the profitable income source after a number of banks found themselves mired in controversy over the so-called &l

Aug 5, 2020By Lee Min-hyung

Banks refraining from sales of risky fund products amid scandals

MetLife considering exiting Korea

MetLife Korea's headquarters in southern Seoul / Captured from websiteBy Kim Bo-eunMetLife is plotting a possible exit from the “unattractive” South Korean market, with the company checking its worth in recent years amid an exodus of foreign insurers in the country, a source said.The recent sale of MetLife Hong Kong also raised suspicions that the U.S. insurer could be pulling out of developed markets in Asia.Regarding the possibility of its Korean business dropping, an industry source said, “MetLife has been checking how much the firm is worth over the years, but this does not indicate MetLife is pulling out.”The company official said the sale of MetLife's Hong Kong unit was based on its position in the market, which has become unattractive due to the dominance of other foreign life insurers there.Following reports of U.S. insurance group Cigna's sale of Lina Korea citing sources at investment banks, concerns are that some foreign life insurers active here may follow suit. Though Lina Korea denied the report, there are sufficient grounds for foreign insurers

Aug 4, 2020By Kim Bo-eun

K bank may go public in 2022 at earliest

K bank CEO Lee Mun-whan speaks during a press conference at the Korea Federation of Banks headquarters in Seoul, Tuesday. / Courtesy of K bankBy Park Jae-hyukK bank will need at least two more years before it can go public, despite increased efforts from the nation's first internet-only bank to normalize business following a 400 billion won ($335 million) capital increase and the financial regulator's approval allowing BC Card to become the bank's largest shareholder.Lee Mun-whan, the bank's CEO, told reporters at a press conference Tuesday that his company would be profitable in 2022 at the earliest and its initial public offering (IPO) could take place after the turnaround.K bank suffered 24 billion won in losses during the first quarter of this year, and saw a net loss of 100 billion won in 2019. The disappointing result was mainly attributed to the fact that its operations had been virtually suspended last year until recently. The lender has undergone difficulties due to a capital shortage, since KT was barred from becoming the bank's largest shareholder over its alleged violatio

Aug 4, 2020By Park Jae-hyuk

K bank may go public in 2022 at earliest

Hanwha joins with Samsung to drop Aussie coal investments

A young student reads a letter to Samsung Electronics Vice Chairman Lee Jae-yong in a protest by a regional unit of the environmental group Climate Strike against Samsung affiliates' coal investments, held in front of a Samsung Electronics Service Center in Changwon, South Gyeongsang Province, Wednesday. / Courtesy of Climate Strike's South Gyeongsang Province chapterBy Kim Bo-eunAmid ongoing protests by environmentalists, Hanwha Investment & Securities and Korea Investment & Securities joined with Samsung Securities to give up additional coal investments in Australia.Regarding the specifics of the decision, Hanwha and Korea Investment officials said Monday the cancellation of the scheduled investments was because of evidence that coal-related businesses lack substantial growth potential.Hanwha and Korea Investment purchased 250 billion won in debt in Abbot Point Terminal. The two local brokerages were known to have discussed refinancing with India's Adani Group worth 210 billion won, sources familiar with the issue said.The latest updates regarding the terminal investment ca

Aug 3, 2020By Kim Bo-eun

Hanwha joins with Samsung to drop Aussie coal investments

Encouraging public afflicted by COVID-19

A placard displaying the lyrics of K-pop superstar BTS' song hangs on Kyobo Life Insurance's headquarters in central Seoul, Monday. The insurer, which regularly hangs up different placards, said it decided to display the lyrics of BTS' hit song "Run" released in 2015, to console and encourage the public at a time when the COVID-19 pandemic shows little sign of slowing. / Courtesy of Kyobo Life Insurance

Aug 3, 2020By Kim Bo-eun

Encouraging public afflicted by COVID-19

Hanwha Life's digital biz at stake over sanctions

By Kim Bo-eunHanwha Life Insurance's 63 building on Yeouido in Seoul / gettyimagesbankUncertainty lingers over Hanwha Life Insurance's new digital projects as the insurer faces financial authorities' sanctions over irregularities that surfaced from inspections last year.According to the Financial Supervisory Service (FSS), Hanwha Life provided illegitimate benefits in the opening of a Hanwha Galleria Duty Free shop at the 63 Building on Yeouido in Seoul. The FSS said Hanwha Life covering renovation costs for the duty free shop violated regulations that limit transactions among group affiliates.The FSS notified Hanwha Life it could receive an institutional warning, which is considered a weighty penalty. Firms that are hit with this sanction are limited in new acquisitions, and any new businesses that require approval from authorities are put on hold for a year. The supervisory agency is set to discuss Hanwha's sanction on Aug. 20. This comes after the FSS and Hanwha Life discussed the issue on July 22, but failed to reach an agreement. The FSS will reach a conclusion on the sanction a

Aug 2, 2020By Kim Bo-eun

Hanwha Life's digital biz at stake over sanctions

Reporter's Notebook Mirae Asset under threat of ex-Kakao Bank CEO

Rep. Lee Yong-woo of the ruling Democratic Party of Korea, left, and Mirae Asset Financial Group founder Park Hyeon-joo / Korea Times filesBy Park Jae-hyukIt was quite surprising that Mirae Asset Financial Group founder Park Hyeon-joo's name was mentioned at the National Assembly last week.Rep. Lee Yong-woo of the ruling Democratic Party of Korea criticized the business tycoon unexpectedly, Wednesday, when Financial Services Commission (FSC) Chairman Eun Sung-soo and Financial Supervisory Service (FSS) Governor Yoon Suk-heun were giving briefings to lawmakers at the National Policy Committee. The main agenda for their briefings was a series of fiascos involving mis-selling of private equity funds, but the lawmaker particularly attacked Mirae Asset and its founder during his question time.He called it “inappropriate” for Park to direct global investments by Mirae Asset subsidiaries.“Mirae Asset has invested a lot in real estate overseas, and this has increased risks,” he said. “Because the owner has believed that he was going in the right direction, the s

Aug 2, 2020By Park Jae-hyuk

[Reporter's Notebook] Mirae Asset under threat of ex-Kakao Bank CEO

Korean Japanese still important to Shinhan

Shinhan Financial Group Chairman Cho Yong-byoung speaks during a general shareholders' meeting at the group headquarters in Seoul in this March file photo. / Courtesy of Shinhan Financial GroupBy Park Jae-hyukShinhan Financial Group's strong ties with ethnic Koreans living in Japan have come under the spotlight again, since one of its Korean Japanese non-executive directors acquired a large stake in the financial group recently.According to a regulatory filing by Shinhan, Thursday, CYS CEO Choi Kyong-rok saw his stake in the financial firm increase to 0.27 percent ― roughly worth 40 billion won ($33 million) ― from 0.19 percent, July 16, after he inherited shares from his father, Choi Young-seok, the former CYS CEO who died in October last year. The late Choi was a non-executive director of the financial group and its banking unit.Given that the Commercial Law prohibits non-executive directors from holding more than a 1 percent stake in the company. Choi is considered to have a significant stake. Furthermore, it is unusual for a son to take over his father's position as a non-executi

Jul 30, 2020By Park Jae-hyuk

Korean Japanese still important to Shinhan

Video conference

NongHyup Financial Group's Business Strategy Group Head and Deputy President Kim Hyung-shin, second from left, is briefed by heads of the financial group's overseas branches at its headquarters in central Seoul, Tuesday. The financial group held a two-day video conference with the 12 heads of its overseas branches in seven countries, aiming to share business performances and strategies amid the COVID-19 pandemic. / Courtesy of NongHyup Financial Group

Jul 30, 2020By Anna J. Park

Banking & Finance