An Occasion for New Resolution

KDIC celebrates 15th anniversary on June 1 with the entire company swearing tighten its financial risk management

Korea Deposit Insurance Corp.(KDIC) celebrated its 15th anniversary on June 1 in a ceremony where all officers and staff, led by Chairman and President Lee Seung-woo, made a new resolution to make a new start to keep the company growing in the future as it had in the past 15 years since its establishment.
Chairman Lee in his congratulatory speech during the ceremony called on every one working for the company to boost their professionalism, strengthen their social responsibilities and exert full efforts for changes and reform, and all geared to protect depositors and financial stability.
Lee also stressed the company should strengthen its monitoring of financial companies, especially, risk monitoring to minimize financial losses and also damages for depositors from unsound financial firms by thoroughly investigating those responsible for the current financial fiasco and effective management of investor financial firms so that the recovery of public funds can be maximized.
All participants of the ceremony signed a resolution to practice clean and ethical management and social contribution to their best knowledge and capacity before the chairman at the end of the ceremony.
Lee said our economy has many problems including real estate prices, uncertainty and housing debts and we have to make our protection of depositors strong now more than ever by redoubling our given responsibilities without a hitch.
In order to carry these duties out, we have to find out the financial risks at the right time by ever strengthening our monitoring posture in the financial market, especially, the savings banks.
At the same time, Lee said we have to monitor financial firms with funds invested by state-run institutions to see if those firms financials are sound and managed effectively under the management normalization agreement.
The aim is to see that those firms financial values are maintained and expanded if possible.
The primary goal of the Korea Deposit Insurance Corporation (KDIC) lies in the protection of depositors funds at KDIC-insured financial institutions. By providing a partial deposit protection system and by acting as the guarantor of depositors funds, the KDIC, in cooperation with other agencies, strives to provide a vital financial safety net in order to help maintain the stability of the nation's financial system.
The Deposit Insurance Fund ("DIF") is maintained as a resource for making insurance claim payments to depositors in cases where insured financial institutions become insolvent or bankrupt and thus unable to make such payments. The DIF is procured through many sources including insurance premium revenues (remitted by the insured financial institutions), proceeds from the issuance of Deposit Insurance Fund Bonds and contributions from government and insurance firms.
The KDIC may request the submission of operations and asset-related data from insured financial institutions and financial holding companies that have pertinent financial institutions (insured financial institutions) as affiliates
under the Financial Holding Company Act, within the scope deemed necessary for determination as to such financial institutions found to be insolvent or potentially insolvent. If an insured institution is found to be on the brink of insolvency based on a preliminary review of such data, the KDIC may perform a more detailed investigation, including a review of the institution's operation and assets (see Paragraphs 1 and 2 of Article 21 of the Depositor Protection Act.
In cases necessary for the protection of depositors, KDIC may submit a request to the Governor of the Financial Supervisory Service asking for the provision of data related to the insured financial institutions within a determined scope. When the KDIC finds it necessary to confirm the data supplied by the Financial Supervisory Service to assess the risk of insured risk events for insured institutions, the KDIC may ask the Governor of FSS to confirm the data, allowing a one-month period to examine the institution. If the data fails to be confirmed, the Corporation
may conduct investigations on the operations and asset status of the insured institutions to confirm the data.
If, as a result of such inspection or investigation, factors are found that may lead to occurrence of an insured risk event, it may also request that the Financial Services Commission take proper steps regarding the institution. nw

Chairman and President Lee Seung-woo of the Korea Deposit Insurance Corp. delivers his congratulatory speech at a ceremony on the 15th anniversary of the company's founding on June 1.

Photo on Courtesy of KDIC

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