Chairman Lim Young-rok of KB Financial 

Group.(photo courtesy of KB Financial)

    KB Financial Holding Co. has promoted President Lim Young-rok, 58, as its chairman on June 5 pending the board’s approval on June 12, the company said.

Following his designation of chairman of the KB Financial Group, the nation’s largest financial group in terms of assets, Lim said he will work to make the financial group the best one in the country, falling back on his diverse experiences in the financial policy arena having been the second vice minister of the Ministry of Strategy and Finance, although he cannot be expansive as he still has to get the board’s approval. He spent three years as president of the KB Financial Group after spending his entire career as a bureaucrat on the financial side of the government.

As for protests by the labor union against his designation, he said it will be taken care of as time passes through ample communication with the union to work for the financial group together. 

A graduate of Seoul National University Teacher’s College, Lim later obtained an M.A. degree in economics at Vanderbilt University in Nashville, Tennessee, the United States.

The new chairman will have to decide whether the financial group will take over the Woori Financial Group, although the government would yet have to decide how the financial group should be taken care of. Reports said the government might decide to have other financial groups take over the group or sell it to private funds. But the reports say there is a strong possibility that KB Financial Group would be tapped to take it over. For the time being, the government wishes for Kookmin Bank and Woori Bank to be independently run, but under a long-term perspective, the two large banks would have to be merged for synergy and a big problem is making the move go as smoothly as it can since there may be conflicts of ideas and interests in the process.

Another problem is that persuading foreign shareholders to agree with the merger would boost the share price of the new bank following the merger.

Another problems is to disperse the profits, making it now heavily dependent on Kookmin Bank as the largest bank in Korea accounts for 90 percent of the profit and assets for the group. Chairman Euh tried to take over ING Life Insurance of Korea to take the load off of Kookmin Bank, but failed due to the objection of the board.

All of those in the group’s management agree with the need to diversify the group’s profit structure, and in this context it is interesting to see how KB Financial will come out when Woori Investment and Securities is put on the sales block. Also, drawing public attention is who will succeed President Min Byung-dok of Kookmin Bank, who resigned after Lim was chosen to be the next chairman of KB Financial. The successor is likely to be promoted from within the bank, as he or she would have to be very knowledgeable about banking operations tied to the fact that the group’s long-term strategy is being taken care of by the KB Financial Holdings.

The chairman-designate would be the first former bureaucrat to lead the nation’s largest financial group. He first entered government service in 1977 as administrative staff at the Ministry of Government Administration before being assigned to the Ministry of Finance as the director of the funding division.

He also served as a member of the SOC Investment Planning Team at Cheong Wa Dae, the presidential office. Lim ended his government career as the second vice minister of the Ministry of Strategy and Finance in 2010 and joined KB Financial Holding as president the same year.