Recently, financial accidents amounting to hundreds of millions of won occurred at KB Kookmin Bank, Shinhan Bank, and SC First Bank. Although these incidents took place at different banks, several similarities were found in this case. First, looking at the amount involved, KB Kookmin Bank reported 2.2 billion won, Shinhan Bank 2 billion won, and SC First Bank 1.5 billion won, which are similar figures. Another common factor is that these financial accidents are linked to a large-scale jeonse fraud that occurred in the Sejong area. Additionally, all three banks disclosed this information on Friday, the 7th.
The fact that the disclosure dates of the three banks coincided is not a coincidence. In the past, banks have preferred to disclose financial accident information on dates preceding holidays such as Fridays. This is interpreted as a measure to minimize awareness of the incidents. Friday disclosures are not illegal acts that violate the law. However, given that internal controls within banks have consistently been problematic, there are opinions that these crafty disclosures by banks are disappointing.
Of the 12 financial accident disclosures posted on the websites of the four major banks (KB Kookmin, Shinhan, Hana, Woori) last year and this year, 8 were posted on the day before holidays. Among these, 7 were on Fridays, and 1 was posted on the day before a designated holiday for the 22nd National Assembly elections. In the case of Woori Bank, a disclosure was made about a loan scandal involving hundreds of millions of won that was already known to involve relatives of former Woori Financial Group Chairman Son Tae-seung, approximately ten days later on a Friday.
The Friday disclosures by banks are interpreted as a measure to inform the public of financial accidents just before the weekend to attract less attention. Compared to other weekdays, Friday sees relatively less public interest in news. There is also less concern that follow-up articles will be published over the weekend, and once the weekend passes, attention shifts to new news. Considering these factors, Friday disclosures are the optimal choice to minimize the spread of bad news.
The practice of Friday disclosures is not unique to banks. There is a similar practice in the securities market known as "owl disclosures." Owl disclosures refer to the action of publicly disclosing adverse information by listed companies after the stock market closes on the day before a weekend or holiday. Financial authorities consider owl disclosures to be actions that restrict investment information and have been calling for improvements in this practice for some time. However, there is no specific regulatory basis to penalize listed companies for owl disclosures.
Similar to the owl disclosures by listed companies, there are also no punitive measures for banks' Friday disclosures. Under the current Banking Act, banks are required to disclose the facts of a financial accident on their website or that of the Bank Federation within 15 days of discovering it. Since banks are granted 15 days to comply with disclosure obligations, there is no basis to penalize them for deliberately choosing Fridays.
Critics argue that banks should prioritize honest information delivery and measures rather than spend time on clever tricks regarding Friday disclosures. Given the decline in trust in the banking sector due to a series of large financial accidents in recent years, there is a perspective that banks should demonstrate a genuine attitude of reflection.
There are also concerns that the practice of Friday disclosures undermines the image of renewal in banks' internal controls. Although banks emphasize strengthening internal controls, if they only choose to disclose financial accident information on Fridays, consumers cannot help but doubt the sincerity of the banks' commitment to strengthening internal controls.
Professor Seong Soo-yong of the Financial Training Institute noted, "If Friday disclosures repeatedly occur, it may inevitably seem like a deliberate act by banks to avoid criticism from public opinion," adding, "A culture should be established where banks disclose immediately upon recognizing a financial accident without considering the date."