The chiefs of top financial service providers of South Korea are to see their terms expire as early as the first half of next year, with efforts toward securing reappointment expected to begin soon

Hana Financial Group, Woori Financial Group, KB Financial Group and Shinhan Financial Group are the country's top four financial service providers. Although primarily known for their banking operations, these groups are managed and controlled through their respective financial holding companies, under the three-year leadership of the group chairs.

Of the four entities, Woori Financial Chair Yim Jong-ryong and Shinhan Financial Chair Jin Ok-dong are both slated to complete their terms in March, while KB Financial Chair Yang Jong-hee’s term is scheduled to end in November 2026. Only Hana Financial Chair Ham Young-joo’s term is set to last throughout next year.

With Korea recently placed under new leadership, financial service providers are preparing for potential regulatory headwinds.

Kim Eun-kyung, a member of the presidential state affairs committee, told the press in June, “When I see former high-ranking officials from the Finance Ministry and the Financial Services Commission join private financial firms, I cannot help but question their standards.”

Her remarks were seen as a direct jab at Woori Financial chief Yim, a former FSC chair and senior official at the Finance Ministry.

With Kim being floated as a potential candidate to lead the country’s financial regulatory authority, her remarks are widely seen as a signal that the new administration could be uneasy with former bureaucrats heading privately owned financial firms.

It would not be the first time major financial firms have undergone a sweeping leadership shake-up under a new government. During former President Yoon Suk Yeol’s term, the chiefs of KB Financial, Shinhan Financial and Woori Financial stepped down following regulatory criticism over extended tenures, forgoing reappointment.

Similar reshuffles have played out repeatedly over the years with each change in administration.

Though the financial service providers are not state-run entities, political intervention remains possible, as the industry operates under government-issued licenses. These firms are vulnerable to pressure from regulators, who hold wide-ranging supervisory authority.

The intervention can at times play a constructive role, particularly given the current ownership structure at the financial holding companies. The firms are often referred to as “ownerless companies,” a term used to describe firms with dispersed ownership and no dominant shareholder.

In such structures, local financial holding company chiefs are able to surround themselves with outside directors and executives of their choosing, effectively strengthening their grip on leadership and enabling long-term consolidation of power.

Intervention from financial regulators can, in a way, encourage the financial holding companies to pursue a “generational shift” in leadership.

The dynamic, however, also means that regulatory interference can undermine stability in management, particularly in developing mid- to long-term strategies and in fostering global credibility.

Deeming the intervention stems from an initial lack of accountability in the executive appointment process, the financial sector has been stepping up efforts to enhance transparency.

In 2023, the Financial Supervisory Service announced a series of measures aimed at improving governance at local financial holding companies. One key initiative requires firms to begin preparing for a succession at least three months before the incumbent’s term ends, ensuring sufficient time for a smooth transition. The FSS further stated in May that it is considering extending this preparation period even further.

In a similar context, delivering tangible results beyond the bottom line has become a critical factor in selection committees' decisions on whether to recommend chairs for reappointment.

"Though the incumbent financial group chiefs are not under strong pressure to step down as most are still early in their terms, they will still need visible achievements to justify any potential reappointment," said an official from a local bank.

Industry watchers project that Woori Financial Chair Yim is unlikely to face difficulties in securing another term. Under his leadership, Woori Financial acquired two insurers this year, bolstering its non-banking portfolio — long considered a key weakness compared to rival financial groups.

The chiefs of Shinhan Financial and KB Financial have yet to make substantial changes, with each focusing on digital transformation initiatives and strengthening internal risk controls. Though Hana Financial Chair Ham faced some hurdles related to the age limit when seeking an extension, he is set to serve until March 2028.

“Solid performance and transparent succession planning could help lessen government influence,” the official said.