The Financial Supervisory Service postponed the announcement of key examination results regarding unfair loans related to Woori Financial Group and Woori Bank to early next year. The decision took into account the recent instability in the financial market due to political issues such as martial law and attempts to impeach the president.
During a ‘financial situation review meeting’ held at the main office in Yeouido, Seoul, on the morning of the 11th, Financial Supervisory Service Chairman Lee Bok-hyun said, “Considering the current economic situation and financial conditions comprehensively, the announcement of key examination results for financial institutions, including Woori Bank, will be postponed to early next year.”
Chairman Lee noted on the 28th of last month that “it has been confirmed that illegal transactions similar to those involving loans to relatives of former chairman Son Tae-seung occurred even during the terms of the current chairman of Woori Financial and the current bank president.” He added, “We will respond sternly to illegal activities and violations of rules with a principle of zero tolerance.” Originally, the announcement of key examination results was scheduled for this month, but it was decided to postpone it due to the ongoing turmoil in the financial market resulting from recent political issues.
During the meeting, chairman Lee urged, “Please ensure that the financial institutions' financial flexibility is not diminished, so as not to affect the supply of essential funds and normal dividends.” He then instructed, “Engage with the market and identify various tasks for regulatory rationalization.”
Lee instructed that improvements should be reviewed regarding the capital buffer ratio regulations for banks and the liquidity ratio calculation standards, to ensure a reasonable level compared to global regulatory standards within the discretion of each country. Regarding the K-ICS (New Insurance Capital System) in the insurance sector, he noted to actively consider using transitional measures applicable during rapid changes in the financial environment.
He added, “As market volatility is increasing due to political unrest, the possibility of significant losses or financial accidents related to derivatives is also growing, so ensure that internal controls are thorough.”