On June 3, ahead of the 21st presidential election, tension is rising in the banking sector. This is due to concerns that social return pressure will intensify regardless of which administration takes office. During the Moon Jae-in administration, it was referred to as 'inclusive finance,' while in the current administration, it is called 'win-win finance.' However, the core issue has always been that the money easily earned from interest should be returned to society in the form of financial support.
The call for banking sessions from political circles is increasing. In January, Lee Jae-myung, the leader of the Democratic Party, summoned bank heads, and now the People Power Party has gathered bank heads as well. Members of the National Assembly's Political Affairs Committee from the People Power Party held an on-site meeting at the Korean Bankers Association in Jung-gu, Seoul, on the 9th, urging financial support for small and medium-sized enterprises and self-employed individuals that are feared to be impacted by U.S. tariffs. Jo Yong-byeong, head of the Korean Bankers Association, noted, 'I will announce a financial support plan for small merchants this month.'
Just three months after announcing the 'win-win finance season 2', which decided to provide 700 billion won each year for 250,000 small merchants and self-employed individuals over three years, the addition of an 'episode' has led banks to show reluctance. A source from a major bank stated, 'We have been making social contributions diligently as per the government's requests, but the demand for pain-sharing toward the banking sector is increasing.' They added, 'We are closely monitoring the dynamics in the political arena.'
Both the People Power Party and the Democratic Party have not yet conducted their presidential candidate primaries, but banks are actively collecting information on the financial pledges being drafted by the two parties. Due to the paralysis of the legislative function of the National Assembly following the state of emergency, even the government relations officers at banks, who had been almost inactive, are on high alert. With a change in administration and policy, prompt responses from corporations are necessary. This is not limited to banks, but political movements aimed at increasing regulation levels, such as the disclosure of additional charge standards, have been detected, making banks pay even closer attention.
The banking sector has become a primary target of political scrutiny as it remains one of the few sectors generating stable revenue amidst economic downturns and the impact of U.S. tariffs. Banks have, in recent times, significantly increased their revenue from interest rates, achieving record results. The estimated net profit for the country's four major financial holding companies for the first quarter of this year is 4.8759 trillion won, the largest ever.
A member of the National Assembly's Political Affairs Committee stated, 'In a difficult situation where even key industries are wobbling, banks are the only place where we can immediately ask for help.' They added, 'It seems both parties will present pledges aimed at increasing the social responsibilities of banks.' During the last presidential election, Lee Jae-myung, the Democratic Party's presidential candidate at the time, proposed 'basic loans,' while Yoon Seok-yeol, the candidate from the People Power Party, highlighted 'disclosure of the interest rate margins of banks' as key financial pledges. The presidential race has just begun, and it is uncertain what pledges candidates will bring forward, but it does not appear that banks will face an easy situation this time either.