Former Deputy Prime Minister and Minister of Economy and Finance Choi Sang-mok submitted his letter of resignation, prompting changes in the activities of the Macroeconomic and Financial Issues Roundtable (F4-Finance 4), which was organized around him. F4 is an informal consultative body consisting of four members: the Deputy Prime Minister and Minister of Economy and Finance, the Governor of the Bank of Korea, the Chairperson of the Financial Services Commission, and the Head of the Financial Supervisory Service. The presence of heads of financial regulatory agencies allows for quick decision-making.
According to government sources on the 9th, F4 has actively intervened in the market whenever problems arose, raising strong voices. This organization was formed in 2022 when Gangwon Province withdrew its payment guarantee for the 205 billion won asset-backed commercial paper (ABCP) issued by Gangwon Development Corporation, causing the bond market to freeze. At that time, it announced a liquidity supply plan of 50 trillion won plus alpha (α) and led an operation to inject a total of 148 trillion won, securing 95 trillion won in funding from the five major financial groups.
Also, that year, when Heungkuk Life Insurance postponed its call option exercise for $500 million worth of overseas hybrid capital securities due to interest rate increases, F4 moved to stabilize the situation as investor sentiment toward Korean bonds deteriorated in the global bond market. This experience led F4 meetings to become regular consultations held weekly at the Bank Hall in Jung-gu, Seoul.
When martial law was declared on Dec. 3 of last year, a meeting was convened in about an hour, and it was announced that 'all possible financial and foreign exchange market stabilization measures, including unlimited liquidity supply, will be mobilized in response to market instability factors.'
However, the situation has become less prominent recently due to the change in administration and the vacancy of the Deputy Prime Minister position. F4 held a meeting on the morning of the 8th, right after the interest rate decision by the Federal Open Market Committee (FOMC). The meeting was chaired by Kim Beom-seok, the Acting Minister of Economy and Finance.
After the meeting, the Ministry of Economy and Finance announced that 'participants in the roundtable (F4) agreed to continue monitoring the financial and foreign exchange markets 24 hours a day, as major events in the international financial market, including the first official trade negotiations between the U.S. and China, are scheduled to continue.'
However, there are opinions circulating both within and outside the government that F4's future activities are uncertain. A Ministry of Economy and Finance official noted, 'It remains to be seen whether F4 will continue to send messages to the market.'
On the 5th (local time), Lee Chang-yong, the Governor of the Bank of Korea, met with reporters at a hotel in Milan, Italy, where he attended the Asian Development Bank (ADB) annual meeting. He said, 'The continuation of F4 meetings will be decided by the new Minister of Economy and Finance,' indicating that the meetings could potentially be suspended.
Meanwhile, some in academia argue that it is inappropriate for F4 to hold meetings. Professor Woosuk Jin of Myongji University remarked, 'F4 meetings have no minutes. They are very inappropriate,' and added, 'Especially, the Bank of Korea is an independent institution, but it is acting in unison with the government through F4 meetings.'
In contrast, Professor Kim Jeong-sik of Yonsei University stated, 'F4 meetings need to continue in some form,' and pointed out that 'In addition to responding to market conditions, the Ministry of Economy and Finance manages fiscal policy, the Bank of Korea manages currency policy, and the Financial Services Commission and the Financial Supervisory Service are responsible for the stability of the financial market, so inter-agency policy cooperation is necessary.'