Woori Bank has been offering loans to customers whose credit capacities have reached their limits and cannot borrow any more from banks, providing up to 3 million won in excess of their credit limit under the name “Woori Hope Dream Small Loans,” the bank said recently.
At the same time, Chairman Lee Pal-seung of Woori Financial Group said he will not condone any requests for personal favors related to personnel matters in the group. In an e-mail sent to all the employees on March 12, he said he will exclude those executives who helped someone in the affiliates of the group in personnel matters from the group’s personnel moves as these actions hurt fair competition and the solidity of the group as a business entity, no matter how high the positions they occupy.
The dream loans have been provided to those with credit ratings of from one to seven grade, but cannot take out bank loans any more and have to turn to curb loan firms, which charge as much as 30 percent interest per year. Dream loans would charge only 8.7 percent on the bail-out loans. The interest rates would fall to as low as 0.5 percent monthly or 4 percent per annum if no default on the interest payments occurred.
The bank also introduced a special high-interest installment savings deposit product called the “Woori Hope Dream Installment Savings Deposit,” that pays 7.5 percent annual interest to attract the basic minimum salary earners, multi-cultural families, and North Korean refugees with less than 12 million won in annual income.
The bank won the General Public Finance Award last year given by the Financial Supervisory Service.
The bank has been strengthening its support to SMEs. The bank changed the name of the SME support unit from the SME Strategy Dept. to the SME Support Department, providing loans with favorable interest rates of just over 3 percent per annum. The loans for operating funds will bear an annual interest rate of 3.5 percent and loans for plant facilities will charge 3.1 percent interest.
Manufacturing and export firms are allowed to borrow from 5 percent to 10 percent over their borrowing limits and 10 percent over on their mortgage values.
Woori Bank provides more than financial support to SMEs. Other support includes free consultations on business management by the bank’s 50 management experts on such subjects as finance, strategy, risk management, accounting, legal matters, and taxes, among others. What the bank wants is to help SMEs to grow stable and strong by jointly making efforts to find strategies to upgrade them to mid-level stable businesses.
Chairman Lee said any high-level officials who helped someone inside the group on personnel matters outside of the personnel policies of the group will have their personnel records specially managed and their improper actions publicly opened so that they will be disfavored in the group’s personnel moves.
Noting that some newspaper articles alluded that Woori Group has the largest number of requests for personnel favors among the financial groups in Korea, he said he can no longer allow the practice to continue and will take measures to prevent it.
He emphatically condemned these practices and said they ultimately hurt the normal operations of the affiliates of the group and discourages those other employees who quietly work hard for promotion, those who are not looking for personal favors. He said he feels very sorry that these practices have been going on among the affiliates of the group.