News Regulations09 May 2018

South Korea:Regulatory agency gets third head in 9 months

09 May 2018

Mr Yoon Suk-heon, visiting professor of economics at Seoul National University, has been appointed the new governor of the Financial Supervisory Service (FSS), the country's financial watchdog.

The Financial Services Commission (FSC), Korea’s top financial regulator, said last Friday that it recommended Prof Yoon as the new FSS head, telling President Moon Jae-in that the nominee is an ideal candidate “to lead innovation” in the industry. Mr Moon confirmed the appointment.

Mr Yoon now becomes the third governor of the FSS under the Moon administration, say local media reports.

Mr Choe Heung-sik stepped down from the post in March, just six months after he assumed the position in September 2017, after allegations surfaced that he helped a college friend’s son get a job at KEB Hana Bank while he was the president of Hana Financial Group in 2013.

Mr Kim Ki-sik, an ex-lawmaker and civic activist, fell out of grace just two weeks after his appointment to the post last month, after some of his actions while as a lawmaker received heavy criticism from politicians as well as the public. Mr Kim was reportedly found to have made an illegal donation to an institute he headed.

The FSC pointed out that Prof Yoon has worked in the public sector in a number of positions including the head of a committee under the Commission that mapped out reforms for the regulators.

Prof Yoon was head of the so-called Financial Administration Innovation Committee, from which he made policy recommendations this year to FSC Chairman Choi Jong-ku such as penalising Samsung Electronics chairman Lee Kun-hee for maintaining bank accounts under other people’s names. 

With him at the helm of the watchdog, insiders predict structural changes in the country’s regulatory framework. 

Prof Yoon and other academics in 2013 proposed a plan to reform Korea’s financial regulatory and supervisory system. The proposals included ensuring the independence of a supervisory institution, which required the dissolving of the FSC and splitting its key tasks between the Ministry of Strategy and Finance and the FSS.

Prof Yoon and his colleagues also proposed that the FSS stop worrying about consumer protection services and a separate body be created to handle such issues.

His appointment reflects President Moon's strong determination to bring drastic change to the financial sector as well as the regulatory system. He is also touted as the architect of the Moon administration's financial reform policy.

 

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