President Lee Kwang-goo of Woori Bank.

President Lee Kwang-goo of Woori Bank has been recommended as the first president of the privatized Woori Bank by the Woori Bank President Recommendation Committee.

The president-nominee will officially take over the office for two years as soon as shareholders approve his nomination in their meeting slated for March 24, the bank said on Jan. 26.

A native of Cheonan, South Chungcheong Province, the president-designate jointed the now-defunct Commercial Bank in 1979 and rose through the rank and file of the bank, taking over as CEO in 2014 of Woori Bank. Woori Bank was launched after the merger of Commercial Bank and Hanil Bank in 1998 following the financial crisis a year earlier to be named as Hanvit Bank. The bank changed its name again in 2002 to Woori Bank. 

The recommendation committee, consisting of outside directors, chose Lee for his excellent record running Woori Bank since becoming CEO in 2014, rather than choosing someone with no proven record managing a bank as the top official.

The committee members considered Lee’s role in the successful privatization of Woori Bank and the bank’s improved performance results, recognizing Lee’s management skills. They think he will be able to come up with the strategies for its future path after selling off its remaining government stake.

At a get-together with reporters following his nomination at the head office of the bank in Sokong-dong, downtown Seoul, the new CEO said the office term would not matter much now that the shareholders consist of private investors who would closely watch where the bank is headed. The president recommendation committee is made of outside directors chosen by the shareholders, and they selected the first CEO of the new private bank which is Woori Bank.

 Lee plans to turn Woori Bank and its affiliates into a financial group led by a financial holding company, upgrading its performance results. The new president is likely to step up a push for M&As to diversify the financial group’s operational areas and thus boost profits.

He is likely to conduct a small personnel-shake up early this year in March and go ahead with setting up the promotion and remuneration systems of the bank by June so that they can be used in the upcoming personnel reshuffle in December.

Included among the M&A plan is a capital firm, an F&I firm to settle defaulted assets and a real estate management firm which will be followed by take over of a securities firm, and an insurance firm based on consultations with the shareholders. Lee would have to take care of the seething rivalry among the former employees of both Hanil and Commerce Banks who joined Woori Bank following their merger, making up around 20 percent of 15,000 total employees of the bank.

The new top management has been called on to expand the base of the customers through the expansion of the bank’s products and services, taking advantage of Fintech and the asset management capacity and develop new earning sources.

The new CEO should focus on finding new growth engines and the basic framework of the bank’s corporate culture, not just going all out on boosting profits, Professor Kim Seong-jo of Hansong University and a member of the recommendation committee said.

The Korea Deposit Insurance Corp. (KDIC) signed a 2.4 trillion won (US$2.06 billion) deal with seven institutional investors on the sale of its 29.7 percent stake in Woori Bank.

Six purchasers have already paid for the stakes, while IMM Private Equity was to pay for a 4 percent interest in Woori Bank to the KDIC, with the money for the remaining 2 percent to be paid later.

In the aftermath of the 1998 Asian financial crisis, the government poured 12.8 trillion won into Woori Bank to keep it afloat, owning a controlling 51 percent stake. It has so far retrieved 8.2 trillion won, or 64.9 percent, of the taxpayers' money.

A view of the building in downtown Seoul where Woori Bank has offices.(Photos: Woori Bank)