The Financial Services Commission stated that it would launch a third Internet bank following Kakao Bank and K-Bank. The Korean government has decided to give its exclusive monopoly to a committee of private experts. But, the establishment of a specialized bank, which was intended to launch the banking licensing division into sub-divisions, was once turned into a mid- to long-term project.

The Financial Supervisory Commission (KFG), on May 2, revealed plans to restructure the entry of the financial industry, which includes such information through the TF finals meeting to formulate measures to regulate the entry of financial businesses, which was presided over by vice chairman Kim Yong-bum.

It has only been 20 years since the financial crisis that the financial authorities have been thoroughly checking the entry restrictions by business sector and putting forward improvement measures. The Financial Supervisory Commission explained that "the intention is to relax regulations on entry of financial companies to stimulate competition in the financial industry and increase consumer convenience."

Meanwhile, the financial authorities first set up a committee to evaluate the competitiveness of the financial industry, and decided to decide on the new entry policy accordingly. It is the intention to raise objectivity and fairness through leaving the policy of entry into the financial sector, which was considered to be the exclusive monopoly of the past supervisory authorities, to the private sector. The evaluation consists of 9 experts from the financial consumer sector, academia, research institute, financial industry and industry. Open the evaluation committee periodically every year and discuss the results.

The financial authorities are expected to construct the evaluation structure immediately and analyze the status of industry by sector. Insurance and the real estate trust business will be checked first and then expanded to other businesses such as banks.

Firstly, the Financial Supervisory Commission has decided to actively review the third Internet banking license to lower the barriers to entry into the financial sector. Since the launch of K-bank and Kakao Bank, major changes have been detected in commercial banks, such as the launch of special 2 %-premium products, and the idea is to make changes to the stagnant financial market through the selection of additional companies. The bank stated it expects to have an additional Internet bank by early next year. However, special banks such as corporate finance specialized banks and private banks, which were announced by the chairman of the final district earlier this year, were classified.

On the other hand, the financial authorities have announced a roadmap to allow entry of new financial institutions, but the reaction in the market is cynical.

It is judged that the addition of a third Internet banker or the approval of a specialized bank is not meaningful. In order for a competitive new financial company to be launched as the "separation of industry and banks" regulations, which strictly distinguish between industrial capital and financial capital, are at stake. It is necessary to allow entry into the industrial capital market, which has abundant financial resources.

In fact, Korea`s No. 1 Internet bank, K-bank has exceeded KRW 2 trillion in total transactions over the past year. However, it is struggling with new product development and entry into the regulatory market due to the blockage of the segregation of bank products. Shim Sung-hoon, chairman of K-bank, stated in a briefing on the first anniversary of its launch last month, "The biggest reason for not delivering new products on time is due to capital increase."

The Kakao Bank, which completed a paid-in capital increase of KRW 500 billion on April 25, also suffered from the fact that Korea Investment Bank, the largest shareholder, would invest only W186bn, which is less than the 290bn stake of 58%.

On the day, the Finance Ministry said that the industry is asking the Congress to relax the regulations on segregation of bank and industries. Choi Ho-hong, chief of the Financial Services Bureau, mentioned, "Internet banking has been promoted on the premise of easing the segregation of silver products and has granted authorization." However, once there is a company that wishes to participate in the current law, we can do it. "

A high-ranking expert of the banking industry said, "It seems that postponing the permission of internet bank and specialized bank since the establishment of specialized bank is not easy due to the regulations on separation of silver, etc. and it will be difficult to enter new businesses. "

By Kim Dong-wook east@dt.co.kr



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