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(Photo= Yonhap news) |
[Alpha Biz= Reporter Kim Sangjin] On the 4th, Financial Supervisory Service (FSS) Chairman Lee Bok-hyun revealed that the recent decision to expedite the regular inspection of Woori Financial Group and Woori Bank was primarily driven by concerns related to risks from the acquisition of insurance companies, rather than issues with inappropriate lending practices.
During a meeting with reporters following a 'household loan demand and expert field meeting' at the KB Kookmin Bank headquarters in Yeouido, Seoul, Chairman Lee criticized Woori Financial for not adequately communicating with financial authorities regarding the acquisition of Dongyang Life Insurance and ABL Life Insurance. He stated, "Even though these are private contracts, Woori Financial should have communicated with the Financial Services Commission and the FSS about potential risks and regulatory issues. However, they did not."
Lee expressed discomfort over the fact that while he was aware of Woori Financial's review of insurance acquisitions, he only learned about the finalization of the contracts through newspaper reports. Woori Financial had announced the completion of the acquisition of Dongyang Life and ABL Life and signed a stock purchase agreement with China-based DaSha Insurance on the 29th of last month.
He added, "Expanding business operations might be beneficial, but there are concerns about whether risks associated with the insurance companies were properly assessed." Lee emphasized that the decision to move forward with the regular inspection earlier than scheduled was to address these risks and evaluate the overall situation comprehensively.
The FSS's decision to advance the regular inspection by a year highlights that the primary concern is the risks associated with the insurance acquisitions, rather than any issues related to improper lending practices. For a financial holding company to acquire an insurance company, it must obtain approval from the financial authorities and meet the required management performance rating of 2 or higher.
AlphaBIZ Kim SangJin(letyou@alphabiz.co.kr)
