With Bin Dae-in, 65, chair of BNK Financial Group, chosen as the final candidate for the next chair, Life Asset Management, which has been challenging the chair selection process, said it would "gather shareholders' votes and raise the issue at the shareholders' meeting in March next year."
A Life Asset Management official said on the 9th, "We plan to continue our existing boycott until the final decision is made through a vote at the shareholders' meeting (on Chair Bin's extension)," adding the same. Life Asset Management holds about 3% equity in BNK Financial Group.
Earlier, on the 8th, BNK Financial held the Executive Candidate Recommendation Committee (the committee) and a board meeting and selected Chair Bin as the final candidate for chair and CEO. If the extension plan is approved at the shareholders' meeting in March next year, Bin will remain chair until March 2029.
That day, Kang Dae-gwon, CEO of Life Asset Management, wrote in a column contributed to a media outlet, "An extension dug in a trench excluding shareholders raises the fear that BNK may remain forever as a 'low-PBR stock' without innovation. This is the background that led us, with heavy hearts, to publicly demand the suspension of the committee and the replacement of the board."
Life Asset Management sent BNK a public shareholder letter on the 4th stating, "Stop the chair selection process." They also reportedly sent nonpublic shareholder letters once each in October and November stating, "Disclose the chair selection process transparently."
This BNK chair selection process drew controversy when the board set the application window for candidates in October to overlap with the Chuseok holiday. Because the Chuseok break was longer than seven days, the application period amounted to only five business days, prompting criticism that this disadvantaged other candidates besides Bin.
Life Asset Management also pointed to BNK Financial Group's weak business performance. As of the closing price on the 1st of this month, BNK Financial Group's year-to-date share price gain was 46%, the lowest among the seven major financial holding companies. The price-to-book ratio (PBR), a valuation metric for listed firms, stood at 0.45, below rival JB Financial's 0.8. On this, Life Asset Management argued, "The results show what happens when 'insider musical chairs' are repeated without bringing in capable external talent."
Some say Life Asset Management is taking issue with the chair selection process to push through demands that would help lift the stock price, such as increasing dividends. There is also a counterargument that, while the application window for next chair candidates in October was only five business days, the preparation time was sufficient.
After selecting the final candidate, BNK Financial's committee said, "We will continue active communication with shareholders together with the final candidate," adding, "We will hold a briefing on the three-year management plan and measures to enhance shareholder value."