Financial watchdog chief’s outspoken remarks draw mixed reactions

Lee Bok-hyun, the governor of the Financial Supervisory Service, delivers a speech during FSS SPEAKS 2025 at the Federation of Korean Industries tower in Seoul, Thursday. Yonhap

Lee Bok-hyun, the governor of the Financial Supervisory Service (FSS), has only about two months left in his term, yet he continues to actively engage in external activities and appear on broadcasts, often making controversial remarks on various issues.

Lee, a former prosecutor and a close aide of President Yoon Suk Yeol, became the financial watchdog chief under the Yoon administration in June 2022. Despite Yoon’s impeachment crisis, Lee has increasingly asserted his voice, strengthening his grip on the organization.

On Wednesday, Lee once again made media headlines after he said he had offered to resign to Financial Services Commission (FSC) Chairman Kim Byoung-hwan in response to acting President Han Duck-soo’s veto of the Commercial Act revision the previous day.

The revision, passed unilaterally by the opposition majority on March 13, is aimed at expanding corporate directors’ fiduciary duties beyond the company to include shareholders.

“I contacted the FSC chairman to express my intent (to resign),” Lee said during his appearance on a CBS radio program.

Earlier, Lee had publicly stated that he could never accept a decision reversing discussions on boosting shareholder value, vowing to stand against the bill’s veto, “even if it meant putting my position on the line.”

Although Lee expressed his intention to step down, the FSC chairman, along with Finance Minister Choi Sang-mok and Bank of Korea Gov. Rhee Chang-yong — key members of the so-called F4 gathering of top financial authorities — urged him to stay, according to him. As a result, Lee’s future is expected to be decided after the Constitutional Court rules on Yoon’s impeachment on Friday.

Choi Sang-mok, third from left, finance minister and then-acting president, holds the F4 gathering of top financial authorities at Government Complex Seoul, Jan. 17. From left are Financial Supervisory Service Gov. Lee Bok-hyun, Bank of Korea Gov. Rhee Chang-yong, Choi and Financial Services Commission Chairman Kim Byoung-hwan. Courtesy of Ministry of Economy and Finance

On Friday, just days before the acting president exercised the veto, Lee abruptly skipped the F4 macroeconomic meeting, fueling speculation that he was taking a confrontational stance against other participants over the Commercial Act amendment.

Choi and other policymakers have expressed concerns about the revision’s potential side effects on businesses and the economy and instead proposed amending the Capital Markets Act as an alternative.

On March 19, during a press briefing, Lee also made a provocative remark about the Commercial Act amendment, saying, “I am putting everything on the line for the advancement of the capital market. I would like to ask those who oppose it — what are they willing to put on the line?”

Other strong statements made by Lee included those regarding Homeplus’s recent entry into the corporate rehabilitation process.

Lee criticized Michael ByungJu Kim, chairman of MBK Partners, the retailer’s largest shareholder, for failing to attend a parliamentary hearing, calling it “deeply regrettable."

Lee also pointed out that the private equity firm’s claim of fully guaranteeing the principal of Homeplus's asset-backed short-term bonds worth 400 billion won ($273 million) seemed like a “lie.”

Within the FSS, opinions on Lee’s statements are divided. Some view his stance as a proactive effort to ensure that the watchdog officials fulfill their role, regardless of the chief’s remaining term. Others, however, criticize his outspoken remarks as unnecessarily controversial.

“He seems to have a strong conviction that the authorities must take action to protect shareholder value,” an FSS official noted.

At the same time, concerns have been raised that such high-profile statements from the head of a regulatory body could undermine financial market stability.

“I hope he considers more carefully the impact his remarks have on the financial markets,” a former senior banking executive said.