Chairman Shin Je-yoon of Financial Service Commission.

Chairman Shin Je-yoon of the Financial Services Commission (FSC) said recently that his first task as chairman is to assess the financial industry’s ability to prevent hacking attacks on their computer networks in the wake of a number of attacks suffered by banks and commercial firms last month and to make sure that such incidents will not happen again.

He said he would go as far as hiring professionals if he has to and buying new equipment to set up a system among the related firms and organizations to make sure that the incidents won’t happen in the future.

The new FSC chairman said the lifeblood of finance is trust and all financial transactions are heavily dependent on the security of IT and electronic systems. 

Shin said the urgent tasks for the FSC are to see that financial institutions provide more humanitarian financial services, the financing to create the future, and that financial institutions become future growth engines, providing jobs and other means to make greater contributions to the country.

The FSC chairman said the financial sector should pay more attention to the quality of financial services from now on under the new government with a creative economy as the centerpiece of its key policies. Financial institutions should help the real economy by providing quality financial support as the new government tries to make it more creative and resourceful, as opposed to past practices of just providing quantitative financial support in an involuntary way.

Shin said the financial institutions only gave loans if they received collateral such as property, not considering the borrowers potential for growth, and if the collateral was not enough, they asked for a government guarantee to avoid risks. But not any more, he said. He intends to change the past practices of making loans by increasing the supply of risk capital through the financial market so that borrowers can borrow money using only their technologies and business potential.

Among the problems he will face as the new head of the FSC are the privatization of Woori Financial Group and KDB Financial Group and the reform of policy loan banks such as the Korea Export and Import Bank and the Korea Trade Insurance Corp., which need to be addressed aggressively from the early stages of the new government.

The chairman has to solve the problems resulting from the complex ownership of those government-policy financial institutions. The majority shareholder of the Korea Exim Bank is the Ministry of Strategy and Finance. The FSC holds a majority share of the Korea Finance Corp. and the Ministry of Knowledge Economy owns the biggest share of the Korea Trade Insurance Corp., all of which need to be cleared up to prevent confusion and improve efficiency.

Given Shin’s experience as the first vice minister of the Ministry of Strategy and Finance, he should be able to come up with solution for the issues related to government-owned financial institutions, such as combining their ownership to make them financially strong and better able to back up private firms that need financial assistance in order to achieve their aims and grow stronger, helping the national economy in the process.

Shin’s diverse experience in international finance while with the MOSF includes his key role in putting together a $30 billion swap fund deal with the United States in 2008 soon after the Lehman Brothers fiasco, helping Korea tide over the global financial crisis.

During the Roh Moo-hyun government, Shin participated on the government team in negotiating a free trade deal with the United States. Under the Lee Myung-bak government, Shin lead the vice finance ministers during the G-20 Seoul Summit in 2010, playing a leading role in putting together an official communiqu? for the important international meeting. He also made a huge contribution to boosting Korea’s sovereign credit ratings and bringing the secretariat of the Global Climate Fund to Korea as the first vice MOSF minister in 2012.