FSC to lift barriers on financial group units

The financial authority has decided to push for lifting or easing the barriers between subsidiaries of financial groups as part its efforts to seek product competitiveness on the global stage.

During a meeting of nine financial group executives on Tuesday, Financial Services Commission chairman Yim Jong-yong vowed to ease the regulatory policies for freer business environment and diversification of financial products.

“The financial group system has contributed to the quantitative growth of the financial industry, but not to its qualitative improvement, as their subsidiaries failed to diversify portfolios and boost synergy as the system originally expected,” the top financial regulatory official said in his opening speech.

The deregulatory move comes 15 years after the country’s highest financial decision maker enforced the financial group system, to solidify the then-faltering financial market in the wake of the 1997-98 Asian financial crisis.

The FSC chief said regulatory officials are pushing to allow officials of the financial companies to hold multiple offices, as long as it does not cause conflicts of interest. They are also seeking to minimize the ban on outsourcing operations, to increase efficiency of some financial groups with multiple subsidiaries, such as Hana Financial Group.

The authority will also broaden ways for financial companies to deliver information to customers. The current regulation only allows for printed documents and emails.

In addition, the FSC said it will strengthen support for financial companies that expand overseas operations and financial technology.

By Chung Joo-won (joowonc@heraldcorp.com)