▲ KB Kookmin Bank CEO Lee Hwan-ju (left) and other heads of major commercial banks take their seats after taking an oath during a parliamentary audit of the Financial Supervisory Service and other institutions held by the National Policy Committee on the 19th. From left are CEO Lee, Shinhan Bank CEO Jeong Sang-hyuk, Hana Bank CEO Lee Ho-sung, Woori Bank CEO Jung Jin-wan, and NH Nonghyup Bank CEO Kang Tae-young. (Photo: Yonhap News)
The chief executive officers of major commercial banks appeared before a parliamentary witness stand regarding the recent financial sector hacking crisis and bowed their heads in repeated apologies.
KB Kookmin Bank CEO Lee Hwan-ju, Shinhan Bank CEO Jeong Sang-hyuk, Hana Bank CEO Lee Ho-sung, Woori Bank CEO Jung Jin-wan, and NH Nonghyup Bank CEO Kang Tae-young attended the afternoon audit of the Financial Supervisory Service (FSS) by the National Assembly's National Policy Committee today (the 19th) as witnesses to issue a public apology regarding customer damages.
In response to a remark by People Power Party lawmaker Kim Jae-seob that "a massive amount of customer information was leaked due to the hacking accident," CEO Jeong Sang-hyuk stated, "I feel deeply apologetic."
CEO Lee Hwan-ju said, "This incident occurred at a financial institution where trust should be the foundation," adding, "I offer my sincere apologies for causing concern to our customers and the public."
He continued, "To prevent recurrence, we will secure sufficient budget and personnel, and do our utmost to respond to AI-powered hacking with AI security systems."
In response to Democratic Party lawmaker Kim Yong-man's pointing out that "KB Kookmin Bank was the first to be breached by hackers," CEO Lee replied, "I have many regrets that we failed to block and respond swiftly."
Regarding allegations raised that "there is a whistleblower report claiming a chief information protection officer ordered the deletion and concealment of logs during a meeting of three related departments on the morning of September 30," CEO Lee responded, "I have never given such an order, nor was I reported on it."
CEO Lee Ho-sung said, "I feel extremely apologetic and sorry for causing concern to customers and the public," adding, "Moving forward, we will expand our budget and personnel further to establish AI systems and make efforts to prevent a recurrence of damage against AI hacking."
Regarding damage compensation, he added, "We have already implemented measures such as fee exemptions, and we will prevent secondary damages through financial safety insurance. While there have been no damages [related to information leakage] so far, we promise to fully compensate for any damages should they occur."
The heads of Woori Bank and NH Nonghyup Bank, which were targeted by hacking attacks but experienced no information leaks, also emphasized that they will establish more thorough security systems.
CEO Jung Jin-wan stated, "I believe the reason we avoided hacking damage this time was simply because we were lucky. Since nearly 200 hacking attacks come in every day, our staff are responding, but it may be somewhat insufficient."
He added, "Going forward, we will maintain a security framework in tandem with the Financial Supervisory Service and the Financial Security Institute to do our absolute best to ensure there are no damages."
CEO Kang Tae-young said, "We will continuously upgrade the next-generation integrated control system established in 2022 to take thorough precautions for robust management."
During the audit, it was pointed out that after the revised Banking Act took effect in July this year, some banks lowered spread rates while cutting preferential rates by an even larger margin.
According to data submitted by the Financial Services Commission to Democratic Party lawmaker Min Byung-duk, KB Kookmin Bank reduced its spread rate from 3.42 percentage points (p) in June to 3.34 percentage points (p) in August, while also cutting its preferential rate from 1.96 percentage points (p) to 1.65 percentage points (p).
Over the same period, NH Nonghyup Bank lowered its spread rate from 3.60 percentage points (p) to 3.34 percentage points (p) while shrinking its preferential rate from 2.19 percentage points (p) to 1.58 percentage points (p).
Lawmaker Min pointed out, "By playing tricks to reduce preferential rates while lowering spread rates, the banks' actual take has only grown larger," criticizing it as "defying the legislative intent of the Banking Act and deceiving [the public]."
National Policy Committee Chairperson Yoo Dong-soo, belonging to the same party, also chided, "Do you intend to suck the blood and sweat out of the public?"
In response, CEO Lee Hwan-ju and CEO Kang Tae-young answered, "We fully understand the concerns regarding spread rates" and "We will report the detailed data."
Demands for corporate governance improvements were also directed at the CEOs of the five major banks, whose terms are set to expire at the end of the year.
In connection with this, when Democratic Party lawmaker Lee Kang-il asked, "Are there any of you who think performance is the most important factor for a bank CEO's reappointment?", CEO Jeong Sang-hyuk of the five bank heads raised his hand alone.
When asked next, "Is it internal management?", CEOs Lee Ho-sung and Jung Jin-wan raised their hands side by side.
Lawmaker Lee emphasized, "It is known in the market that the chairman's intent matters most," adding, "Appointments of bank CEOs should not be swayed by the chairman's influence, but rather decided by the board of directors through a comprehensive evaluation of capabilities such as performance and internal controls."
(Photo: Yonhap News)
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