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Related Organizations

The FSS coordinates its examination functions with the Financial Services Commission, the Bank of Korea, and the Korea Deposit Insurance Corporation in order to ensure timely and effective examination and supervision. The FSS also routinely shares supervisory information with other oversight authorities on a regular basis.

Financial Services Commission

As the government regulatory authority, the Financial Services Commission (FSC) is vested with broad powers under the Establishment Act to set the government's financial market policies, propose changes to financial legislation for passage by the National Assembly, make rules, grant regulatory licenses, and decide on major enforcement actions. Under the two-tier system created by the Establishment Act, the FSS is subordinate to the FSC and subject to FSC oversight in respect of its inspection, examination, investigation, and enforcement activities.

The FSC is led by nine commissioners including the Chairman and the Vice Chairman; each serves a three-year term. The Chairman is appointed by the President with the recommendation of the Prime Minister. The Vice Chairman is appointed by the President with the recommendation of the Chairman of the FSC and concurrently holds the position of the Chairman of the Securities Futures Commission (SFC) within the FSC. Two standing commissioners are appointed with the recommendation of the Chairman of the FSC. Of the five non-standing commissioners, four are ex-officio positions held by the Vice Minister of the Ministry of Strategy and Finance (MOSF), the Governor of the FSS, the Deputy Governor of the Bank of Korea, and the President of the Korea Deposit Insurance Corporation. The remaining non-standing commissioner is appointed with the recommendation of the Chairman of the Korea Chamber of Commerce and Industry, who recommends an industry representative.

The FSC is a government agency whose officers are barred from holding any political position or engaging in any commercial activity during his/her tenure on the Commission. The nine commissioners are also barred from participating in the resolution of matters that may raise conflict of interest. Matters that come before the commissioners for resolutions are passed by the majority of the quorum.

As part of its regulatory oversight, the FSC deliberates and decides on policy matters relating to the inspection and supervision of financial institutions and the securities and futures markets. Matters relating to the securities and futures markets are largely delegated to the SFC. The FSC also has the authority to issue and revoke licenses from financial institutions. Legislation relating to the financial sector is drafted and submitted to the National Assembly by the FSC.

The Securities and Futures Commission is an oversight committee integrated within the FSC responsible for the regulation of the securities and futures markets. It consists of five members who are appointed by the President for a renewable three-year term. The Vice Chairman of the FSC concurrently holds the position of the Chairman of the SFC. The standing commissioner and three non-standing commissioners are appointed with the recommendation of the Chairman of the FSC. The principal role of the SFC is to direct the investigation of market abuses, such as insider trading and price manipulation in the securities and futures markets, and to establish accounting standards and audit reviews. In addition, the SFC conducts advance review of matters relating to the securities and futures markets to be deliberated by the FSC.

Bank of Korea

The Bank of Korea, established in June 1950 under the Bank of Korea Act, is Korea's central bank. The Monetary Policy Committee, the highest decision-making body within the central bank, sets monetary policies in pursuit of price stability. Because of the Bank of Korea's long-standing interest in preserving a safe and sound banking system, the FSS maintains a close cooperative institutional relationship with the Bank of Korea.

In respect of banking supervision, the Bank of Korea may, when deemed necessary, request the FSS to conduct an examination of a specific financial institution or to conduct a joint examination with the participation of specialists from the Bank of Korea. The Bank of Korea may also request the FSS to share the findings of examination conducted at the request of the Bank of Korea and to take appropriate supervision actions. The information-sharing MOU that the FSS has signed with the Bank of Korea provides for, in principle, unrestricted information exchange for financial supervision and banking safety and soundness purposes unless specifically prohibited under the law for privacy and other applicable grounds.

Korea Deposit Insurance Corporation

The Korea Deposit Insurance Corporation (KDIC) was established on June 1, 1996, following the enactment of the Depositor Protection Act on December 29, 1995, to protect depositors and help maintain the stability of the banking system. When deemed necessary for its depositor protection mandate as provided under the Depositor Protection Act, the KDIC may request the FSS to carry out an examination of an insured institution or to provide for the participation of its specialists in the examination. The FSS and the KDIC have signed an MOU to facilitate active and ongoing information exchange.

Financial Services Industry Self-Regulatory Organizations and Associations

Credit Finance Association of Korea (CREFIA)

Established in 1998, CREFIA represents 68 credit specialized finance companies that include credit card companies, leasing companies, installment finance companies, and venture capital companies. CREFIA promotes sound financing practices and consumer information for sound industry growth.

General Insurance Association of Korea (GIAK)

Formed in 1946, GIAK works to foster sound development of the general insurance industry and facilitate communication between general insurers and insurance policy holders.

Korea Asset Management Corporation (KAMCO)

KAMCO was founded in 1962 as a national asset management agency. It purchases NPLs from financial institutions for disposition, promotes restructuring of heavily indebted companies, and manages state-owned properties.

Korea Credit Guarantee Fund (KODIT)

Established in 1976, KODIT provides credit guarantee services for promising SMEs that are unable to obtain unsecured credit from commercial lenders. KODIT also manages credit information to promote sound borrowing and lending.

Korea Trade Insurance Corporation (K-Sure)

Initially set up as Korea Export Insurance Corporation in 1968, K-Sure provides trade insurance, credit analysis, and debt recovery services in order to facilitate export and overseas investment.

Korea Federation of Banks (KFB)

The KFB has been representing banks since it was first formed in 1928. Its members include commercial banks, specialized banks, regional banks, and foreign bank branches. The KFB works to ensure effective communication and cooperation among its members and provide common policy recommendations for the banking industry.

Korea Federation of Savings Banks (KFSB)

Created in 1973 as a trade association, the KFSB serves its member banks by making recommendations for sound development of the industry, arranging IT support, and providing training for the member banks' managers and employees.

Korea Financial Investment Association (KOFIA)

KOFIA was founded in 1953 as Korea Securities Dealers Association. KOFIA is a self-regulatory organization that sets industry regulations, reviews financial investment products, inspects member firms, and administers certifications for finance professionals.

Korea Financial Telecommunications & Clearings Institute (KFTC)

Established in 1986, the KFTC is a payment settlement service provider that manages interbank payment networks in order ensure efficient information flow and secure financial transactions.

Korea Fire Protection Association (KFPA)

The KFPA is a professional risk management organization established in 1973 to promote fire safety and the fire insurance industry.

Korea Insurance Brokers Association (KIBA)

Founded in 1999, KIBA represents insurance brokers, makes policy recommendations for insurance brokerage, and provides training for insurance brokers.

Korea Insurance Development Institute (KIDI)

Founded in 1983, KIDI aims to ensure fair and reliable insurance premium determination. KIDI has twenty-four life insurers and nineteen nonlife insurers as its members.

Korea Life Insurance Association (KLIA)

Established in 1950, the KLIA works to promote the common interests of the life insurance industry. Its members consist of 22 life insurers, Korean RE, and IBK Pension Insurance.

Korea Securities Computer Corporation (KOSCOM)

KOSCOM was established in 1977 as a company specializing in IT services for securities firms. KOSCOM operates major IT systems for Korea Exchange and OTC markets, collects and processes financial information, and provides other IT infrastructure services.

Korea Securities Depository (KSD)

Since its creation in 1974, the KSD has been providing custody and settlement services as Korea's central securities depository. Approximately 1,500 financial institutions are KSD participants.

Korea Securities Finance Corporation (KSFC)

The KSFC was established in 1955 to supply funds to the securities market through loans backed by securities. The KSFC also manages deposits that securities investors place on financial firms for securities purchases and settlements.

Korea Technology Finance Corporation (KOTEC)

KOTEC was created in 1989 to provide support to SMEs and start-ups with technology assessment and credit guarantees for technologically promising companies.

Korean Federation of Community Credit Cooperatives (KFCC)

Established in 1973, the KFCC promotes the interests of community credit cooperatives. The KFCC also manages the Depositors Protection Fund.

National Credit Union Federation of Korea (NACUFOK)

Founded in 1964, the NACUFOK functions as an industry association and intermediary for credit unions. It also offers insurance services to its members.

National Forestry Cooperatives Federation (NFCF)

Since its founding in 1962, the NFCF has been providing policy funds to forest owners and managers. It also represents two million forestry cooperative members.