Three new policymakers join Lee's economic team
The stalled consolidation of the financial industry is likely to gain momentum this year under new top regulator Kim Seok-dong, renowned for drive and problem-solving ability.
President Lee Myung-bak on Friday named Kim, 57, chairman of the Financial Services Commission. He will take office on Monday.
As a former director general and vice chairman of the FSC over the past few years, he is credited for successfully resolving a variety of industry troubles, including the credit card fiasco in 2003.
Kim played a leading role in pooling commercial banks into a bailout scheme when the crisis of LG Card ― now merged into Shinhan Card ― hit the market.
The market is now paying keen attention to Kim’s role in handling the pending M&As. Among them are the ongoing takeover battle between Hyundai Group and Hyundai Motor Group over Hyundai Engineering & Construction, and Hana Financial Group’s planned acquisition of Korea Exchange Bank.
Both deals hit a snag last year; creditors of Hyundai E&C withdrew the preliminary contract with Hyundai Group to sell the builder and the union of KEB is strongly opposing the merger between Hana and their bank.
While outgoing FSC Chairman Chin Dong-soo has taken a low-key position, there is a possibility that Kim will not hesitate to intervene.
A previous remark by Kim as FSC director general is receiving attention again: “The authority exists to control the market,” he had told reporters. He will outline his policies at a news conference as early as this Monday.
On Friday, KEB’s union called on him to reject Hana Financial’s bid to buy a controlling stake in the bank from U.S.-based Lone Star Funds.
Other pending issues include the sale of Woori Financial Group and the Korea Development Bank.
Before joining the FSC, he had served at the Finance Ministry since the 1980s. He most recently worked as CEO of Nonghyup Economic Research Institute.
In the ministerial reshuffle, Kim Dong-soo, CEO of the Export-Import Bank of Korea, was named chairman for the Fair Trade Commission.
His nomination came as the administration strongly is pushing to weed out corporate irregularities and promote mutually beneficial relationship between large and small firms.
“President (Lee Myung-bak) is concentrating on establishing a fair society. I believe the nomination is a request for the FTC to play a leading role in the state policy,” he was quoted as saying.
The 55-year-old nominee had mostly worked for the Finance Ministry after passing the higher civil service examination in 1979.
The presidential office also selected top presidential aide for economic affairs Choi Joong-kyung, 54, as Minister of Knowledge Economy. Like the two FSC and FTC nominees, Choi spent most of his public life at the Finance Ministry.
The market expects that Choi will efficiently implement Lee’s economic policies.
He said Friday that he would prioritize fostering new growth engines and strengthening cooperation with other countries for development of energy and natural resources.
Unlike the FSC and FTC chairmen, Choi must undergo a parliamentary hearing before taking office.
By Kim Yon-se (firstname.lastname@example.org)