Top-down appointed IBK CEO turned away amid union resistance

The state-run Industrial Bank of Korea on Friday faced a dispute over the appointment of its new chief, as its labor union protests what it called the government’s “abuse of authority.”

On Friday, newly appointed CEO Yoon Jong-won, 59, a former senior presidential secretary for economic affairs, failed to enter the bank’s headquarters in central Seoul amid protests by union members, who barricaded all entrances to the building starting early in the morning. 

The previous day, Cheong Wa Dae named Yoon as the new CEO to replace Kim Do-jin, whose three-year term ended last week. It did not offer reasons for its choice.

The head of the state-run bank is appointed by the president upon the recommendation of the Financial Services Commission chairman. However, CEOs have been appointed from within the bank for the past 10 years. Therefore, the latest move has rekindled debate about the government’s influence on financial organizations.

While Yoon’s appointment had been rumored, IBK union members had questioned the candidate’s banking expertise and leadership.

Other candidates that Cheong Wa Dae had in mind were Ban Jang-sik, another former presidential secretary, and two former Finance Ministry officials.

As a result, criticism arose about financial bureaucracy, often referred to as “Mofia,” a term that combines “Ministry of Finance” and “Mafia.”

“In 2013, the then-Democratic Party opposed the appointment of a bureaucrat as IBK CEO, claiming that the government’s excessive meddling (in bank affairs) is toxic,” said the bank’s union in a statement issued Thursday, shortly after the Blue House’s announcement of the appointment.

“The incumbent administration is contradicting itself by forcing a top-down chief appointment on the IBK, which has been achieving remarkable growth under its past three chiefs, who were all chosen from within.”

Yoon offered to compromise, saying, “I shall listen to what the labor union has to say.”

But he refuted criticism that he was underqualified and had taken the post through political influence.

By Bae Hyun-jung (tellme@heraldcorp.com)