FSC Finally Leaving Seoul... 2027 Sejong Move Sees Ministry Merger Talk 'Resurface'

Move planned for the second half of next year... 420 FSC and KoFIU employees affected

FSC staff unsettled despite hopes for "Seoul as a financial capital"

Kwon Dae-young's appointment as first vice minister of finance also back in focus
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The Financial Services Commission (FSC) will relocate to Sejong in the second half of next year. The move has been confirmed despite the FSC having remained in Seoul through several previous discussions about relocating to Sejong, stirring unease within the agency. There is also speculation that discussions about merging the FSC with the Ministry of Finance and Economy, which were pursued after the Lee Jae-myung administration took office last year but ultimately fell through, could be reignited by the relocation.

According to the Ministry of the Interior and Safety and other relevant ministries on October 13, the government announced detailed plans for the second phase of relocating central government agencies, including the FSC's move to Sejong in the second half of next year.

The plan calls for 44 central government agencies and other organizations currently located in the Seoul metropolitan area to be relocated to Sejong in stages from 2027 to 2031. The relocation will involve 420 people in total, including 340 FSC employees and 80 employees of the Financial Intelligence Unit (FIU), which operates under the FSC.

The FSC has effectively been the only central government ministry to remain in Seoul. Given that it stayed in the capital despite several discussions about relocation, employees have responded with a sense that "the inevitable has finally happened," along with evident dismay.

Some employees who had hoped the FSC would remain in Seoul are also disappointed, particularly after a series of recent remarks by the presidential office and the ruling party about developing Seoul into an economic and financial hub. At a press conference last month, President Lee Jae-myung referred to "Seoul as the economic capital and Sejong as the administrative capital." Kim Min-seok, leader of the Democratic Party of Korea, also said, "We should make Sejong an administrative capital like Washington and Seoul a global financial and cultural capital like New York."

An FSC official said, "In light of remarks by the president and the ruling party leader, the FSC's move to Sejong appears to have been decided as part of the broader relocation of central government agencies, rather than based on where financial and economic functions should be located. It is true that we had hoped to remain in Seoul, but it has now become difficult to keep hoping against hope."

Many employees are hesitant to move to Sejong because of issues such as having two working spouses and their children's education. An FSC director-level employee said, "I had been preparing myself mentally, but now that the relocation has been decided, I feel unsettled. Considering my children's education and the fact that both my spouse and I work, it would be difficult in practical terms for the whole family to move to Sejong. For now, I'm considering commuting or living apart from my family during the week."

There is also interest in whether the FSC's move to Sejong will lead to renewed discussions about merging it with the Ministry of Finance and Economy.

After the Lee Jae-myung administration took office last year, it pursued a restructuring of the financial regulatory system that would merge the FSC with the Ministry of Finance and Economy and separate the Financial Consumer Protection Bureau from the Financial Supervisory Service (FSS), but the plan was ultimately shelved. With the FSC now set to establish its offices alongside the Ministry of Finance and Economy in Sejong, some speculate that the organizational restructuring proposals discussed at the time could be revisited.

The recent appointment of Kwon Dae-young, a former FSC vice chairman, as the first vice minister of the Ministry of Finance and Economy has also drawn attention in connection with this speculation. Some interpret Kwon's move to the ministry as a possible step taken with a future organizational and personnel merger between the two agencies in mind. In particular, some inside and outside the FSC believe that if the restructuring takes the form of the FSC being absorbed into and merged with the Ministry of Finance and Economy, Vice Minister Kwon could play a role in personnel and organizational management.

A financial industry official said, "The fact that Vice Minister Kwon, who previously worked at the FSC, is now at the Ministry of Finance and Economy could be significant if a merger is pursued in the future. It's difficult to predict whether the two ministries will merge, but if they do, he could help reflect the FSC's position to some extent or mitigate any personnel disadvantages for employees from the FSC."

However, some urge caution, saying the FSC's move to Sejong will not automatically lead to a merger with the Ministry of Finance and Economy, and it remains to be seen whether discussions on actual restructuring will resume.

The FSC's relocation to Sejong has also drawn attention to the future locations of other public financial institutions, including the FSS, Korea Development Bank, Export-Import Bank of Korea, and Industrial Bank of Korea (IBK).

The government plans to review separately whether these institutions should relocate. The Ministry of the Interior and Safety says the FSS, in particular, requires further consideration regarding relocation outside the capital area because it is a special corporation, unlike ordinary central government agencies.

Although this relocation plan focuses on central government agencies, discussions could gather pace when the government announces its plan to relocate public institutions outside the capital region, expected later this year, potentially reigniting debate over the future locations of public financial institutions. However, the political burden stemming from opposition by financial-sector unions and a decline in President Lee's approval rating for his administration, as well as political leaders' stated vision of developing Seoul into a global financial hub, are seen as factors that could affect the outcome. Some therefore believe the relocation of public financial institutions could be discussed separately from that of the FSC, a government agency.

This content was produced with the assistance of AI translation services.