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[News Focus] Labor-friendly government boosts confidence of financial unions

Unions of FSS, banks raise voices over leadership appointments

In line with the rise of the liberal Moon Jae-in government and the appointment of a former financial unionist as labor minister, financial labor unions have recently been increasing their leverage with their employers, especially over the issue of leadership appointment.

On Wednesday, the labor union of the Financial Supervisory Service issued a statement, lashing out at the government’s purported decision to appoint Seoul Philharmonic Orchestra CEO Choe Heung-sik as the next chief of the financial supervisor.

“By tapping Choe for the FSS governor post, Cheong Wa Dae has made no consideration for our independence as a supervising body,” the union said.

“Should he be appointed, the FSS will degenerate into a puppet of the Financial Services Commission bureaucracy, no longer in control of the financial market.”

The disputed official formerly served as CEO of Hana Financial Group from 2012-2014 and chief director of the Korea Institute of Finance from 2004-2007.

The FSS union found fault with his affiliation with Hana Financial Group, citing its connection to the corruption scandal involving former President Park Geun-hye and her friend Choi Soon-sil.

“It has not been long since Hana Bank turned out to have granted illicit loans to support Choi and her daughter Chung Yoo-ra. To appoint a former senior official of such an organization as FSS chief would contradict (the Moon administration’s vow to) eliminate evil practices,” the union said.

Amid ongoing disputes over the incoming leadership, Gov. Zhin Woong-seob held his farewell ceremony in the afternoon, leaving it to the presidential office and the FSC to seal his successor‘s appointment.

The FSS union has previously stated its preference for the forthcoming leadership.

On Monday, it issued a statement to support Kim Jo-won, former secretary-general of the Board of Audit and Inspection who had for some time been rumored to be the next FSS governor.

Such aggressive moves by the union marked a contrast from its relatively laid-back attitude under the former conservative Park administration when it had raised little objection against then-chiefs.

The union, however, claimed that its recent arguments were because of the incongruity of the potential candidates and are not related to the character of the ruling state power.

Other labor unions in the financial sectors have also seemingly become vocal.

On Tuesday, unionists of KB Kookmin Bank held a press conference at the National Assembly, demanding that the company halt the appointment process for the next chairman of the KB Financial Group. The event was attended by two lawmakers of the ruling liberal Democratic Party of Korea.

Also, some 10 financial companies returned to the negotiating table with their unions to discuss the introduction of performance-based salaries, in the wake of the Korean Financial Industry Union’s gesture to otherwise file a lawsuit against the corresponding chief executives.

Industry observers say that the rising leverage of labor unions, including those in the financial circles, may be related to Labor Minister Kim Young-joo, who formerly was a member of the KFIU.

Oh Jung-geun, professor of finance and information technology at Konkuk University, noted that the recent power expansion of financial labor unions may influence the nation‘s financial competitiveness in the global market.

“Excessive bureaucratic influence used to be the biggest problem in Korea’s financial market, but now labor (union) power seems to be the new agenda,” he said.

“The trend of the financial innovation around the world is (to increase) labor flexibility, not to add on the vested rights of conventional unions.”

The financial labor circles, however, underlined that their recent set of actions were quite unrelated either to the liberal president or labor minister.

“We are only exercising our labor rights, as we always have since 2010,” a senior official of the umbrella union said.

“It is unreasonable to make it sound as if we were riding on the current (liberal) government power to infringe on managing rights.”

By Bae Hyun-jung (
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Korea Herald daum