The National Agricultural Cooperative Federation formed a "trust recovery task force (TF)" this month to draw up reform plans related to restoring soundness and ethical management. As the government recently raised the pressure by conducting a special audit of NongHyup, the federation is moving quickly to prepare improvement plans for overall organizational operations at the federation level.
According to the financial industry on the 23rd, the National Agricultural Cooperative Federation launched the trust recovery TF on the 13th, headed by the Chairperson, the head of the planning and coordination headquarters. Fourteen people, including the Chairperson, the chief of staff of the federation's planning office, and major department heads, joined the TF. The TF was formed with the goal of securing management stability by improving soundness and promoting ethical management by overhauling unreasonable systems.
The TF will also work to strengthen the "emergency management system." NongHyup has been maintaining an emergency management system since May last year due to a sharp increase in nonperforming asset. NongHyup's member cooperatives' arrears rose by more than 4 trillion won, from 14.3 trillion won (arrears ratio 4.03%) at the end of 2024 to 18.7 trillion won (arrears ratio 5.16%) in May last year. The federation plans to use the TF to devise measures to strengthen communication with the National Assembly.
The TF will proceed by having major department heads present issues related to their respective fields and, based on that, drawing up reform plans. Detailed agenda items have not yet been finalized, and the National Agricultural Cooperative Federation plans to continue holding weekly TF meetings until the reform plan is completed.
NongHyup has recently come under government pressure as corruption allegations continue. The Ministry of Agriculture, Food and Rural Affairs detected 65 cases, including the lavish overseas trip by Chairperson Kang Ho-dong of the National Agricultural Cooperative Federation, and referred two suspected misconduct cases to the police for investigation. The government also formed a joint special audit team with the Office for Government Policy Coordination, the Ministry of Agriculture, Food and Rural Affairs, the Financial Services Commission, the Financial Supervisory Service, and the Board of Audit and Inspection, and will begin a special audit of the National Agricultural Cooperative Federation and the NongHyup Foundation starting on the 26th. A total of 41 people, including those from public institutions and outside experts, will be mobilized for this audit, an increase of 15 compared with the ministry's audit team (26 people).
An official at the National Agricultural Cooperative Federation said, "We launched this TF to restore public trust and improve internal systems."