S. Korean Financial Firms Shedding "Pure Blood Custom"

Leaders of South Korea's top-tier financial firms expressed eagerness to allow outside experts to take top management positions to boost earnings growth.

The nation's financial industry is hampered by the prolonged economic slowdown and low-interest rates.

Shinhan Financial Group Chairman Cho Yong-byoung is at the forefront of appointing experts outside of the group to major leadership posts.

Last March 20, Shinhan Investment announced the appointment of Lee Young-chang, a capital markets expert, as its CEO despite coming from Mirae Asset Daewoo.

Lee was the first outside expert recruited by Shinhan Investment to take over the role of CEO.

In February last year, Sung Dae-kyu was appointed CEO by Shinhan Life Insurance.

Sung came from government entities such as the Korea Insurance Development Institute and the Financial Services Commission.

Woori Financial Group Chairman Son Tae-seung also broke conservatism in the banking industry by Kwon Kwang-seok as Woori Bank CEO.

Before his appointment, Kwon headed the credit business of the Korea Federation of Community Credit Cooperative's (KFCCC). He also served as Woori Bank vice president until February 2018.

Son, who decided to tap Kwon in recognition of the latter's diverse experience, said that the local banking industry's adherence to the "pure-blood custom" is its biggest problem. He vowed to remain aggressive in tapping the services of outside experts when necessary.

Woori also appointed former Hancom CEO Noh Jin-ho as its chief information officer and leader of its ICT division.

Hana Financial Group Chairman Kim Jung-tai has also adopted the same mindset as Cho and Son's.

In March, Hana Financial Investment promoted former CEO Lee Jin-kook as vice chairman of the group, despite spending over two decades with Shinhan affiliates before joining Hana in March 2016.