With the change of government, the replacement of financial holding company chief executives (CEOs) has been repeated, drawing attention in the financial sector toward the reappointment of the chairpersons of financial holding companies, who will finish their terms next year. There are projections in the financial sector that regardless of whether Lee Jae-myung of the Democratic Party of Korea or Kim Moon-soo of the People Power Party wins, CEOs who started their terms under the Yoon Suk-yeol administration may face pressure to resign.
According to the financial sector on the 23rd, Shinhan Financial Group Chairman Jin Ok-dong and Woori Financial Chairman Yim Jong-ryong will finish their terms in March next year. In November next year, KB Financial Chairman Yang Jong-hee's term will expire.
Under the Yoon Suk-yeol government, all five financial holding company chairpersons have been replaced. Sixteen days after the 20th presidential election in March 2022, Hana Financial Group Chairman Ham Young-joo took office, and the following January, former NH Nonghyup Financial Chairman Lee Seok-jun began his term. In March of the same year, Chairpersons Jin Ok-dong and Yim Jong-ryong began their terms, respectively. By August of that year, former KB Financial Chairman Yoon Jong-kyu decided to step down, marking the replacement of all five financial holding company chairpersons.
In this process, Financial Supervisory Service Chairperson Lee Bok-hyun openly intervened in the selection of financial holding company chairpersons. Before former Chairman Yoon decided to step down, the possibility of a fourth term was mentioned, prompting Lee to effectively pressure Yoon for his resignation by stating, "I hope you will set a precedent for advanced governance."
There are concerns in the financial sector that such government intervention in finance will continue in the next administration. In the case of Chairman Yim, there are predictions that his reappointment cannot be guaranteed. At the time, the prevailing view was that former Chairman Son Tae-seung would be reappointed, but he stepped down under pressure from financial authorities. Subsequently, Chairman Yim, who is a former Financial Services Commission Chairperson, was appointed.
KB Financial has been evaluated as having significantly improved the governance structure that was vulnerable to external pressures during the term of former Chairman Yoon Jong-kyu. However, there are analyses suggesting that external influences still play a role, given that former Chairman Yoon had conflicts with financial authorities during his resignation process. Before his retirement, he was the only one among the leaders of the five financial holding companies to be selected as a witness at the National Assembly's Political Affairs Committee's audit.
Kim Sung-tae, president of the Industrial Bank of Korea, will also finish his term in January next year. Given the nature of state-owned banks, the prevailing view in the financial sector is that his chances of reappointment are low. Unlike commercial banks, where the board of directors determines the candidates for bank president internally, the president of the state-owned Industrial Bank of Korea is appointed by the president upon recommendation from the Financial Services Commission.
Shinhan Financial is relatively free from external pressures compared to other financial companies, operating under a governance structure centered on overseas Korean residents and private equity funds (PEF). However, there were also criticisms that former Chairman Cho Yong-b young's sudden resignation while seeking a third term was influenced by the government and financial authorities.
A source in the financial sector noted, "I understand that the financial committee of this candidate's election campaign is being led by Democrats who are former heads of financial unions," adding, "If the government decides to do so, there are many ways to shake the financial holding company chairperson."