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(Photo= Yonhap news) |
[Alpha Biz= Reporter Kim Minyoung] On the 19th, Financial Supervisory Service (FSS) Chief Lee Bok-hyun strongly criticized the recurring financial accidents in the banking sector.
At a meeting with 20 domestic bank CEOs held at the Bankers Club in Jung-gu, Seoul, Lee emphasized the urgent need for bold cultural changes within organizations to embed compliance and ethics deeply into all employees' business practices and internal control activities.
He pointed out the alarming rise in incidents such as incomplete sales of DLF, Lime hedge funds, and Hong Kong H Index ELS in the banking sector in recent years, alongside ongoing embezzlement through document forgery, attributing these to moral insensitivity and lax internal controls among bank employees. Lee stressed that these issues not only undermine the industry's reputation and trustworthiness but also threaten the financial soundness of banks with increased operational and business risks.
Lee highlighted that financial authorities have been rigorously enforcing laws and procedures over the past few years to prevent large-scale incomplete sales and financial accidents. He outlined plans to introduce new supervisory measures to fundamentally change organizational culture within banks, alongside innovations in internal control and governance structures to enhance compliance.
Lee emphasized the necessity for bold cultural changes at the organizational level to ensure that compliance and ethical awareness permeate all employees' business operations and internal control activities. He underscored the importance for CEOs to foster a culture where any employee can raise concerns about potential incomplete sales or financial accidents without hesitation. Furthermore, he advocated for a fundamental overhaul of performance reward systems that currently prioritize short-term results over internal control and risk management.
Alphabiz Kim Minyoung (kimmy@alphabiz.co.kr)
