1,720 Financial Supervisory Service Employees Petition President Lee: "Relocation to Provinces Is the Worst Decision"

"80% of Employees Under 40 Willing to Leave"
"Consumer Protection Capabilities to Weaken with Relocation"

The Financial Supervisory Service Labor Union announced on September 4 that Chairman Sangwoo Kim submitted a petition to President Lee Jaemyung expressing concerns about the potential relocation of the Financial Supervisory Service and other public financial institutions to local regions. The petition included signatures from 1,720 employees of the Financial Supervisory Service.

On the 4th, at Yeonpungmun Gate of the Blue House in Jongno-gu, Seoul, Kim Sangwoo, Chairman of the Financial Supervisory Service Labor Union (left), is handing a petition to Bae Jinkyo, Secretary for Public Affairs. Financial Supervisory Service Labor Union

During the submission of the petition, Chairman Kim stated, "If the Financial Supervisory Service and public financial institutions are relocated to provincial areas, it is obvious that the competitiveness of the financial industry will inevitably be weakened," adding, "We are deeply concerned that we will not be able to effectively respond to damages suffered by financial consumers."

In the petition, the labor union argued that if the relocation takes place, the competitiveness of the financial industry could be compromised due to several reasons: restrictions on information exchange among financial institutions, supervisory authorities, and market participants; a decline in the quality of financial services; the outflow of talented individuals; and a weakening of the Financial Supervisory Service's ability to oversee and inspect issues such as the misselling of financial products and unsound business practices by financial companies.

The union stated in the petition, "The relocation of the Financial Supervisory Service and public financial institutions to provincial areas would be the worst possible decision, running counter to the trend of the times," adding, "It is desirable to keep these institutions concentrated in Seoul, the financial hub."

The labor union argued that since Seoul was designated as a financial hub after the enactment of the Financial Hub Act during the presidency of the late President Roh Moo-hyun in 2003, the financial industry has developed over the past 20 years. They claimed that relocating these institutions to provincial areas would weaken the international competitiveness of the financial sector.

They especially expressed concern that the departure of professional personnel from the Financial Supervisory Service could intensify after relocation. According to a survey of Financial Supervisory Service staff, if relocation is officially decided, 609 out of 757 respondents (80.4%) under the age of 40 said they would consider leaving. Among 172 lawyers, 147 (85.5%) responded they would leave, along with 285 out of 361 accountants (78.9%), and 203 out of 310 employees holding master's or doctoral degrees (65.5%).

Weakened capacity to protect financial consumers was also cited as a reason for opposition. According to the labor union, out of approximately 800,000 financial complaints filed annually, more than 80 percent are concentrated in the Seoul metropolitan area. Furthermore, 3,468 people visit the Financial Supervisory Service headquarters each year to file complaints in person.

The union added, "Even if financial consumers raise their voices, if the Financial Supervisory Service is distanced from the frontline of supervision, the ability to detect and respond early to market risks directly linked to consumer harm, such as the misselling of financial products and unsound business practices by financial companies, is highly likely to be weakened," stressing, "Ultimately, these harms may be borne by the general public."

Previously, in June, Financial Supervisory Service Governor Lee Chanjin also commented on the topic of relocation, stating, "It is unreasonable for the supervisor of a construction site to be absent from the site."

The day before, the government held a press conference at the Government Complex Seoul to announce its "Plan for the Relocation of Administrative and Public Institutions," stating that the relocation of approximately 350 public institutions from the capital area to local regions will begin next year. The Financial Supervisory Service and Korea Development Bank are also likely to be included among the institutions subject to relocation.

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