Sweeping changes expected in state-run bank leadership

South Korea’s top state-run financial bodies are expecting leadership changes, with candidates -- who worked for the former Roh Moo-hyun administration -- awaiting presidential approval.

The Financial Services Commission Chairman Choi Jong-ku recommended Lee Dong-gull, a business administration professor at Dongguk University, to head the Korea Development Bank on Thursday.

During the first 18 months of the Roh administration, Lee served as a vice chairman of the Financial Supervisory Commission, a precursor to the FSC. Lee, 64, also served as the head of equities and futures market watchdog under the FSC, as well as president of the Korea Institute of Finance, a local think tank. Lee holds a Ph.D in financial economics from Yale University.

If approved by President Moon Jae-in, Lee will replace Lee Dong-geol who has led the state-run bank since last year.

Finance Minister Kim Dong-yeon also recommended Eun Sung-soo, chief executive officer and chairman of the Korea Investment Corporation, as the chief of the Export-Import Bank of Korea.

Formerly a presidential economic aide for Roh from 2005 to 2006, the 56-year-old Eun served as executive director at the International Bank for Reconstruction and Development and at International Finance Corporation before leading the KIC.He holds a Ph.D in economics from the University of Hawaii.

The top post at Export-Import Bank has been vacant since Choi left to lead the FSC in July.

Moon served for his political ally Roh as presidential secretary for civil affairs twice during Roh‘s tenure.

The nominee of the Financial Supervisory Service governor is also waiting for Moon‘s approval, despite some market concerns questioning his political neutrality. The nominee, Choe Heung-sik, currently the chief executive of Seoul Philharmonic Orchestra was the former president of Hana Financial Group. The nomination of Choe to the top post of FSS, an executive body of the FSC, prompted concerns among some that certain private financial institutions might be given favors.

“Choe‘s career in a private financial institution might leave the independence of financial watchdog in question,” read a statement by People’s Solidarity for Participatory Democracy on Thursday.

Chiefs of all three financial bodies are given a three-year term. But leaders of state-run banks leaving their posts in the event of a change of the government has been regarded as customary procedure.

Other financial bodies are also expecting a new leader. They include market operator, the Korea Exchange, whose former Chairman Jeong Chan-woo offered to step down on Aug. 17.

By Son Ji-hyoung
(consnow@heraldcorp.com)