With two months left in his term, Lee Bok-hyun, head of the Financial Supervisory Service, is embarking on a series of overseas business trips. He recently visited Hong Kong and China, and a trip to Switzerland is scheduled for next month. The purpose of his recent Hong Kong and China visit was to meet with officials from overseas investment banks (IB) and financial authorities regarding the resumption of short selling, but there are whispers locally that "there were no pressing issues to discuss." There are concerns that it is an 'extravagant trip' without any significant achievements as his term comes to an end.
There are many critical views about the upcoming trip to Switzerland as well. He is visiting Switzerland for the Basel Committee on Banking Supervision (BCBS) and the Group of Governors and Heads of Supervision (GHOS) meeting, but with urgent issues piling up, such as the Homeplus incident and allegations of stock manipulation involving SAMBU Construction, this schedule is being viewed as overly relaxed.
According to industry sources on the 21st, voices of criticism arose among global IB personnel based in Hong Kong regarding Lee's activities during his visit on the 14th and 15th. One official noted, "When he attended the event, I got the impression that preparation was significantly lacking," adding, "There was an explanation regarding the recently resumed short selling in South Korea, but it was not something the head needed to fly here to discuss. I don't understand why he came."
Another source indicated that the FSS hurriedly recruited overseas IB practitioners for the event. A financial company official working in the area said, "At the end of the event, when it was time to take photos, the head asked even general staff members, not just key stakeholders, to come on stage," suggesting that it was interpreted as an effort to showcase that they met with many people despite a poorly organized event.
As pointed out by participants, there are no significant achievements noticeable from Lee's trip to Hong Kong. The FSS stated that Lee had discussions about issues like the resumption of short selling through investor briefings (IR) aimed at global IBs and met with heads of financial authorities to discuss advancing the capital market and South Korea-China cooperation plans.
According to IB industry sources, this trip to Hong Kong by Lee was hastily arranged by Han Seung-soo, the representative of Morgan Stanley Korea. Representative Han has a history of meeting with Lee during a meeting held by the American Chamber of Commerce in Korea last year.
An industry insider said, "Looking at the people Lee met during this trip, I question whether they are of a 'level' that would warrant meeting with the FSS head," adding, "There is a clear difference compared to those who accompanied him on his trip to Hong Kong at the end of last year." This source continued, "Of course, there are times when the head needs to communicate directly with practitioners, but this time was not one of those cases."
The individuals Lee met during his trip to Hong Kong mostly consisted of executives holding deputy roles in global IBs within the Asia-Pacific region. This is a stark contrast to the delegation from last November's Hong Kong IR, which included representatives of global IBs from the Asia-Pacific region, heads of domestic financial holding companies, and CEOs of major securities firms.
Next month, a trip to Switzerland is scheduled. Since taking office, Lee has attended the Basel Committee on Banking Supervision (BCBS) and the Group of Governors and Heads of Supervision (GHOS) meetings held annually in Basel, Switzerland.
The problem is that domestic financial market turmoil continues, and with numerous pressing issues to address, attending a meeting that is not urgently necessary stands out as questionable. After the announcement of the aggressive tariff policy by the Trump administration, domestic and international financial markets have been fluctuating significantly, and there are numerous individual issues that the FSS needs to monitor.
Issues such as the Homeplus incident, allegations of stock manipulation by SAMBU Construction, as well as the operating status of asset management companies' exchange-traded funds (ETFs), and inspections of captive sales by securities firms are piling up. In particular, this month, the FSS promised to take action on the Homeplus incident and reach a conclusion on the SAMBU Construction stock manipulation case. This means that the top official of the institution overseeing the domestic capital market must vacate their position at a time when a response is necessary depending on these issues.
As the head of the FSS, Lee has been traveling extensively and has received harsh scrutiny. Last year, he came under criticism for submitting a lump sum to legislators requesting overseas business trip details under the name of 'per diem' without specific breakdowns.