Opposed to Market Rates
for Loans for the Poor Firms

Chmn. Kim calls for special loan interest rates for concessionary loans
for poor firms

Chairman Kim Seung-yu of Hana Financial Group said that it's nonsense to leave interest rates for concessionary loans for underperforming businesses up to the market. Chairman Kim, who doubles as chairman of the Miso Finance Central Foundation, refuted the idea without hesitation.
He doesn't seem like a man who spent over four decades seeking profits in the financial industry and earning the reputation as Korea's representative banker.
Kim went on to say that concessionary loans for the financially poor businesses are not related to the principle of supply and demand, frankly speaking, and he doesn't agree with the idea that interest rates for those loans should be based on market rates.
He said the poor are financially powerless if they are left to the market, which is a one-way street for them. Therefore, the concessionary interest rates determined by the government on loans to the poor is not populism.
During an interview with the media at his office in Eulji-ro, downtown Seoul, where the foundation is located, Kim said he doesn't have a problem wearing two hats as the chairman of both the foundation and Hana Financial Group. He said when he does work for Hana, he is totally interested in pursuing profits for the group, but while he wears the hat for the foundation, he is concerned with sustainability and doing good work for the financially poor small businesses.
Kim said his two jobs could be a win-win situation in the long run, as he can help upgrade the poor businesses to financially healthy ones. But he said the firms on welfare programs should not be mixed with healthy firms because they belong in different financial arenas. He said he thinks the financial firms should be led to make more profits and that part of those profits should be used for good causes.
On Nov. 26, 2010, Hana Bank announced that the bank had received the President's Commendation at the 4th Money Laundering Prevention Day hosted by the Korea Financial Intelligence Unit (KoFIU).
At the ceremony, held in the international meeting room in the Korea Exchange, Chairman Chin Dong-soo of the Financial Services Commission and Commissioner Choi Soo-hyun of the KoFIU were in attendance. Hana Bank Vice President Hong Wan-sun attended in order to receive the award, while Busan Bank and Tong Yang Securities Inc. received the Prime Minister's Commendation and SC First Bank received the Financial Services Commission's Commendation.
In preparation for the implementation of a series of systems, such as stricter customer due diligence, which began in December 2008, Hana Bank has played a leading role in establishing and operating the money laundering prevention system, despite the lack of understanding among Korean financial institutions about the importance of experience and systems to prevent money laundering.
On June 27, Hana Bank said that it had decided to make an equity investment worth $316 million in the Bank of Jilin, China, in connection with a need to secure a strategic business partner in the three Northeastern provinces of China and expand its local sales network in the country.
Hana Bank expects that this new step will bring synergistic effects to both the banks and its local corporation in China, Hana Bank China. Having secured a total of 13 business channels, Hana Bank China plans to beef up its retail sales toward locals by fully utilizing the 367 branches of the Bank of Jilin.
Hana Bank also hopes to enhance its sales competitiveness through the occupation of the market ahead of other banks in the three Northeastern provinces of China that display a high potential for economic growth. Thus, it aims to take full advantage of the small number of foreign financial institutions in the area.
The bank obtained the approval of the China Banking Regulatory Commission (CBRC) concerning its purchase of equity in the Bank of Jilin and is making preparations to register the change in shareholders'equity. The bank will purchase 1.2 billion shares of common stock of the Bank of Jilin at a price of 1.8 yuan per share (face value being 1 yuan per share). The bank's equity in the Bank of Jilin will come to about 18 percent following a capital increase. nw

Chairman Kim Seung-yu of Hana Financial Group.

Photo on Courtesy of Hana Financial Group