(Photo= Yonhap news)

 

[Alpha Biz= Reporter Kim Jisun] The Financial Supervisory Service (FSS) has strongly criticized Woori Bank for failing to report and disclose information regarding improper loans linked to the family of former Chairman Son Tae-seung.

According to the FSS on the 25th, the inspection revealed that Woori Bank was aware of criminal allegations and the related facts as early as its internal audits from January to March and its internal disciplinary actions in April. However, the bank only announced these issues around August 9. This suggests that the obligation to report and disclose the financial incident arose at least before April.

Additionally, it was confirmed that Woori Bank recognized that a significant portion of the problematic loans identified in the FSS's inspection had been improperly handled and deteriorated by the fourth quarter of 2023, prior to the internal audit in January. If the bank had been aware of criminal allegations at this point, it could be argued that the obligation to report and disclose the financial incident had already occurred.

According to banking laws and regulations on inspection and sanctions, financial institutions must promptly report financial incidents involving criminal allegations, such as embezzlement or breach of trust, to the FSS and disclose them on their websites.

The FSS also noted that subsequent measures, such as internal audits, were not carried out in a timely manner. Woori Bank was notified of problematic loans handled by a specific branch manager from July last year and became aware in September-October of the same year that these loans were related to the former chairman's family. Despite this, the bank did not report to the regulatory authorities or undertake immediate internal audits. It was only in January of this year, after the branch manager's retirement in December, that the bank began an internal audit and completed it by March, followed by disciplinary actions in April.

 

 

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