The Korea Herald


Top regulator pledges to increase inspectors

By 김연세

Published : April 7, 2011 - 18:15

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Financial Supervisory Service Gov. Kwon Hyouk-se reiterated Thursday that he would increase the manpower directing probes of financial companies by reshuffling the regulatory body.

Kwon, who took office as the chief financial regulator a week ago, told reporters that he would prioritize increasing the ratio of inspectors among FSS staffers in coming months.

He cited the slashed ratio of inspectors ― 330 out of the 1,600 staffers in 2011 ― while the number came to 350 out of the 1,400 staffers in 1999 when the FSS was established.

“Assets held by financial companies surged to about 3 quadrillion won ($2.68 trillion) from 1 quadrillion won during the period (past 12 years),” he said. “But the ratio of inspectors declined to 20 percent from 28 percent.”

But he clarified that the policy is designed to enhance the regulatory body’s function of “supervision,” saying, “It is not aimed at harassing financial companies.”

In addition to increasing the inspectors, he said the FSS will unveil policies to upgrade its inquiry system in late April or May. “We will also benchmark the cases of overseas regulatory bodies.”

While Kwon downplayed speculation that the policy is mainly focused on tougher action against financial companies, he stressed that more irregularities will possibly be unveiled thanks to the strengthening of the probe function.

He also commented on the recent problems of the financial market, hinting at taking more effective disciplinary measures against rule-violators.
Kwon Hyouk-se Kwon Hyouk-se

Concerning the heated competition among credit card companies, he said it is unnecessary for the FSS to crack down on salespeople on the streets.

“We will hand down heavy sanctions on companies which (recklessly) issued credit cards to customers in low credit standings,” he said. “The FSS plans to analyze their issuance records for the recent six months.”

As a substitute for credit cards, the regulatory body is set to unveil the policy to promote the usage of check cards ― which contain functions of both credit and debit cards.

Regarding the banking sector, he said the FSS ― in coordination with foreign regulators ― will support the commercial banks making inroads into overseas market.

Major banks, including the nation’s top three, Kookmin, Woori and Shinhan, are gearing up to increase overseas branches. They are focusing on China and several Southeast Asian countries where the wealthy middle-income bracket has recently increased, buoyed by their rapid growth pace.

But simultaneously, FSS officials said the need to bolster their risk management is growing.

By Kim Yon-se (