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- Korea’s First ‘Climate President’ Lee Launches Race to Recover Lost Time
- For the first time in Korean history, a presidential administration has come to power with climate policy as a core national agenda.
As South Korea has long been regarded as one of the world's laggards in the global energy transition, the new administration is expected to launch a high-speed campaign to recover lost time.
President Lee Jae-myung officially began his duties on the morning of June 4 by taking the oath of office at the National Assembly.
In his inaugural address, President Lee emphasized, "The climate crisis threatens humanity and is forcing a massive industrial transformation. The rapid changes in the global order, including rising protectionism and the reorganization of supply chains, are directly threatening our very survival."
This appears to reflect the current global context, where the European Union is leading in energy transition and countries like the United States are implementing carbon tariffs and clean competition legislation, raising “green tariff barriers.”
President Lee continued, “Unfortunately, at this critical juncture, we face a complex web of overlapping crises in every sector—from the economy and people’s livelihoods to diplomacy, security, and democracy. The present and future of Korea are simultaneously under threat.”
During the presidential campaign, Lee pledged concrete and essential actions to tackle the climate crisis, including achieving the 2030 Nationally Determined Contributions (NDC) target, hosting the 33rd UN Climate Change Conference (COP33), and strengthening carbon reduction incentives.
Lee is the first Korean president to directly highlight climate issues in an inaugural address and express strong commitment to addressing them. By contrast, former President Moon Jae-in in 2017 promised inter-Korean forest cooperation to reduce greenhouse gases, but did not treat it as a core agenda.
President Lee also vowed to fully implement the RE100 (100% renewable energy) initiative, seen as a crucial step for South Korea’s industrial climate response.
As of 2024, data from the OECD shows that South Korea’s share of renewable energy remains at about 10%, the lowest among major economies. The OECD average exceeds 35%.
Despite this, the previous Yoon Suk-yeol administration faced strong criticism for setting a modest target of just 29.2% renewable energy by 2038 in the 11th Basic Plan for Long-Term Electricity Supply and Demand. Many in politics, industry, and environmental circles have labeled the Yoon era as “three lost years.”
In contrast, President Lee has announced plans to establish a dedicated Ministry of Climate and Energy and rapidly expand renewable energy use.
In his inaugural speech, Lee said, “We will swiftly transition to a renewable energy-centered economy in line with global climate response trends. This will help reduce energy imports, enhance corporate competitiveness through RE100, and revitalize declining local areas by building a dense renewable energy grid so that anyone, anywhere, can generate clean energy.”
His government plans to install more solar panels on general buildings, parking lots, and industrial complexes, and increase support for improving solar technology efficiency. A plan to create a RE100 industrial complex to supply power to the semiconductor cluster in Yongin has also been announced.
Environmental groups both in Korea and abroad, which had long criticized the lack of progress under the Yoon administration, welcomed Lee’s policy direction. However, they also expressed concern that the announced measures fall short of fully delivering on his promises.
One of the key criticisms is the lack of a detailed roadmap for phasing out fossil fuels other than coal. Although Lee pledged to close all domestic coal power plants by 2040, no clear plan was presented for reducing the use of liquefied natural gas (LNG).
A Greenpeace representative noted, “President Lee’s platform still lacks a clear roadmap for reducing LNG use, and there is no plan for managing rising methane emissions. The construction of six new LNG power plants to meet power demands for the Yongin semiconductor cluster directly contradicts the climate agenda and must be canceled.”
In a joint report with Greenpeace, the Korea-based group Climate Solution analyzed alternatives to supply the 3-gigawatt electricity demand of the Yongin national industrial complex with nearby renewable energy instead of LNG. Their analysis found that doing so could save up to KRW 30 trillion (US$ 20.9 billion) in electricity costs by 2050. Considering the avoided social costs of LNG construction, the economic impact of renewable procurement would be even greater.
Beyond LNG issues, Greenpeace pointed out the need for stronger policies on plastic reduction, expansion of domestic environmental protection zones, and improved response systems for climate disasters.
The Green Transition Institute, a Korean climate policy think tank, also issued a similar policy recommendation, emphasizing that the government’s current plans lack specific financial strategies for the energy transition.
President Lee has stated that the necessary funding will come from a supplementary budget this year and from increases in total government revenue starting next year.
The Green Transition Institute stressed, “President Lee’s term may be Korea’s last golden window for serious climate action. We must not waste this precious opportunity and must escape our status as a climate laggard.”
#LeeJaeMyung #KoreaClimatePolicy #RE100 #EnergyTransition #GreenNewDeal #Renewables #Inauguration #CarbonNeutrality #ClimateCrisis #Sustainability
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- Kbank’s Final Hurdle: Choi Must Fix Board to Become Real Bank
- “We gauged market demand while pursuing the IPO this time. We plan to regroup and try again in January 2025.”
This is what Choi Woo-hyoung, CEO of Kbank, told reporters after attending the 9th Financial Day ceremony in Yeouido on October 29, 2024.
Although the timeline has been slightly delayed from what Choi initially stated, Kbank officially resolved to resume its IPO efforts at a board meeting in March 2025, marking its third attempt at going public.
Typically, the success of an IPO hinges on a company’s business model and financial stability. However, for a company to be properly valued by the market after listing, it must also adopt an advanced governance structure that ensures board independence. Going public is essentially a declaration to undergo external scrutiny regarding managerial transparency and accountability.
This is particularly significant for Kbank, which operates in the banking sector—an industry closely tied to the national economy. For such an institution, board independence and governance transparency are even more critical.
The issue, however, is that Kbank has consistently faced criticism regarding the independence, diversity, and expertise of its board.
△Kbank Exceeds KRW 2 Trillion in Capital, Still Fails to Meet Gender Diversity Requirements
According to Kbank’s Q1 2025 quarterly report, its total capital stood at KRW 2.0153 trillion (US$ 1.4 billion), exceeding the KRW 2 trillion threshold.
Under Article 165-20 of the Capital Markets Act, financial or insurance companies with capital exceeding KRW 2 trillion must not have a board composed entirely of directors of the same gender.
Despite this, Kbank’s current board is composed solely of men, thereby failing to meet the legal requirement.
Gender diversity on the board is also a symbolic indicator of corporate sustainability and inclusiveness. Foreign institutional investors, in particular, often consider a lack of gender diversity a significant governance flaw.
KakaoBank, a competitor, appointed Lee Eun-kyung, head of the law firm Sanji, as its first female outside director in August 2022—prior to the revised law's enforcement—and has maintained at least one female director since. The current sole female outside director, Kim Ryun-hee, an associate professor of Technology Management at KAIST, will serve until March 2026.
While some dismiss such moves as token gestures, KakaoBank at least fulfills the basic institutional requirement—unlike Kbank.
△CEO Also Serving as Board Chair—Higher Standards Required for Banks
Choi Woo-hyoung currently serves as both CEO and board chair of Kbank. Unlike the lack of female board members, this dual role is not illegal.
Article 13 of the Financial Company Governance Act requires the board chair to be an outside director. However, Paragraph 2 of the same article allows for a non-outside director to assume the role if the company discloses the reason and appoints a lead outside director to represent other outside board members.
Nonetheless, Kbank is not merely an internet service company—it is a bank that collects customer deposits, issues loans, and manages customer assets.
Given its role as a financial institution operating on public funds, Kbank must uphold higher governance transparency than general corporations. While it may be common in many companies for the CEO to also chair the board, banks are held to a different standard.
After going public, KakaoBank appointed outside director Jin Woong-sub as its board chair, signaling a clear intent to strengthen governance transparency. Similarly, if Kbank wants to be a true participant in the capital market through its IPO, it must build a governance structure that meets such expectations.
△Board Lacks IT Expertise in Digital Banking Era
Concerns have also been raised about the composition of Kbank’s board. Apart from attorney Oh In-seo and engineering PhD Lee Kyung-sik, all of Kbank’s outside directors come from financial backgrounds.
Notably, there are no cybersecurity experts on the board—a point of concern for investors and customers alike.
Following a major customer data breach at SK Telecom, public attention toward corporate data security has intensified. As an internet-only bank offering all services digitally and remotely, Kbank’s system reliability and cybersecurity capabilities are directly linked to customer trust.
As ESG management becomes a corporate imperative, voices are also calling for the inclusion of directors with ESG expertise. Especially post-listing, investor scrutiny of board composition will intensify, making it urgent for Kbank to restructure its board now in preparation.
△IPO Is Just the Start—Board Reform Is the Final Piece to Becoming a True Bank
As Korea’s first internet-only bank, Kbank has pursued various innovations to date.
It has secured a market presence through user-friendly digital services and flexible product offerings and now aims to leap forward through its IPO.
Given the nature of the banking industry, the transparency and independence of the board are prerequisites for gaining customer trust. The board is not merely a legal formality but a mirror reflecting the company’s philosophy and management principles to the market.
If Choi Woo-hyoung’s goal is not just to list Kbank but to transform it into a genuine bank, the board is the first place that needs change.
An industry insider commented, “A bank is not just a profit-making entity—it’s a financial intermediary with public responsibilities and systemic risk management roles. Thus, governance transparency and board independence are held to far stricter standards than in ordinary firms. During an IPO process, external pressure for board independence becomes even more intense to ensure investor protection.”
A Kbank representative stated, “Financial soundness is the most important factor in operating a bank,” and added, “Key indicators such as delinquency rates and the ratio of substandard or below loans improved significantly in Q1 this year.”
#Kbank #IPO #governance #ChoiWoohyoung #genderdiversity #boardtransparency #bankingindustry #corporategovernance #ESG #cybersecurity
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- Factory Boy Who Envied School Uniforms Rises to Presidency
- Lee Jae-myung of the Democratic Party of Korea is all but confirmed to have been elected as the 21st President of the Republic of Korea as of 11:40 p.m. on the night of the 3rd.
After losing the 2022 presidential election, his political career faced a severe threat amid a series of prosecutorial investigations, indictments, and trials. He even faced actual physical violence. Yet, he overcame each ordeal, scaled the National Assembly fence during the "night of martial law," and now, the people have entrusted him with the helm of the Republic of Korea.
President-elect Lee began his life as a child laborer, unable to attend middle or high school. He later passed the qualification exam, entered university, and passed the bar exam to become a lawyer.
Though he emerged from humble beginnings, he returned to the grassroots. He joined civic movements and entered politics. After several setbacks, he rose steadily through the ranks, first as mayor of Seongnam, then as governor of Gyeonggi Province.
Writer Yoo Si-min once described him as a “work in progress.” The Lee Jae-myung of ten or five years ago is not the same as today. Still, the path he has walked laid the foundation for who he has become. Three pivotal moments define his journey.
① From Factory Boy to Civic Activist: A Life Changed by Roh Moo-hyun’s Lecture
President-elect Lee was born as the seventh of nine children in a very poor family in a remote mountain village in Andong, North Gyeongsang Province. Due to extreme poverty, his family relocated to Seongnam, Gyeonggi Province, where he was unable to attend middle school and worked as a factory boy.
He recalled in his autobiography, “During the six years I worked in factories, my body was covered with metal and chemicals, but I was nothing more than a nameless factory boy.”
Eventually, he passed the college qualification exam and entered the law department at Chung-Ang University as a scholarship student. Though he had grades high enough to enter Seoul National University, he chose Chung-Ang for the financial support it offered.
While preparing for the bar exam, he dreamed of more.
In his web autobiography, he wrote, “I realized that through the bar exam, I could rise to a mainstream position in society—as a lawyer, judge, or prosecutor. I decided I needed to make another leap in status through the bar exam.”
However, a lecture he attended in 1987 during his time at the Judicial Research and Training Institute altered his life trajectory. It was delivered by Roh Moo-hyun, then a renowned human rights lawyer.
He recalled, “Listening to Roh Moo-hyun, I thought, ‘You can make a living without becoming a judge or prosecutor,’ and I began to dream of becoming a human rights lawyer.”
His decision to live as a civic activist wasn’t solely because of that lecture. From his college days, he had felt a calling to contribute to society in some form.
After failing the second round of the bar exam in his senior year due to a careless mistake, he took a year off to study again. He later reflected that this failure gave him a new perspective on life.
He came to understand that the pain he had endured during adolescence was not a personal issue, but a structural and societal problem. It became a turning point that made him deeply aware of his historical responsibilities.
In his autobiography, he wrote, “Had I passed the bar exam in my senior year, I would have become a judge or prosecutor, and I would have found ways to justify and not regret that choice. But after a year of retrying, I resolved to participate in social activism as a lawyer.”
A journal entry from his time at the Judicial Research and Training Institute reveals that he had vowed to dedicate his life to civic activism upon seeing the oppression of workers.
After completing his training, he ended a brief stint as a probationary prosecutor in Andong and opened a law office in front of Seongnam City Hall in 1989, entering the lives of ordinary citizens. In 1994, he joined the civic group “Seongnam Citizens’ Alliance” as deputy secretary-general and also worked with Lawyers for a Democratic Society (Minbyun).
The 2004 campaign to establish Seongnam City Hospital became a turning point that led him into politics.
He strongly protested with citizens after a resident-initiated ordinance, backed by 20,000 Seongnam citizens, was rejected in just 47 seconds by the ruling Grand National Party in the city council. He was indicted for obstructing official duties and went into hiding for five days in a small prayer room in the basement of a local church.
It was in that church basement that he decided, “I’ll enter politics to create the society that citizens want.”
Eventually elected as mayor of Seongnam, his first pledge was to build Seongnam City Medical Center. Even after resigning as Gyeonggi governor in October 2021, his first visit was to that very hospital.
② Surviving Prosecution, Indictments, and Death Threats
President-elect Lee survived it all. Though he repeatedly faced prosecutorial investigations and indictments that threatened to end his political life, he grew in stature through it all.
He was indicted in eight separate cases before becoming president, and faced five trials simultaneously during the campaign.
Even a single conviction could have ended his political career, let alone his presidential bid. Yet he endured the countless investigations and trials, and his supporters became more united.
Even during his time as governor, he nearly crossed the “Jordan River.” Prosecutors indicted him for spreading false information during the 2018 gubernatorial election. The appeals court sentenced him to a KRW 3 million fine, which would have annulled his election. But the Supreme Court overturned the ruling in July 2020, allowing his return.
His greatest crisis came in September 2023.
Prosecutors sought an arrest warrant for charges including perjury, preferential treatment in the Baekhyeon-dong project, and illicit payments to North Korea. Then-Democratic Party leader Lee went on a hunger strike to protest what he saw as unjust investigations and urged his colleagues to reject the motion to lift his immunity. However, dissenting votes within his own party allowed the motion to pass the National Assembly. It was his biggest political crisis.
The image of him entering the court leaning on a cane for his arrest warrant hearing—after the toll of the hunger strike—was one of the most critical moments of his political career. He seemed like a candle in the wind.
But the court rejected the arrest warrant, and he returned once again. Lee thanked the judiciary, calling it “a clear proof that the court remains the final bastion of human rights.”
Even during the impeachment crisis of former President Yoon Suk-yeol, Lee faced challenges.
In a case over golf-related campaign photos, a district court found him guilty and sentenced him to probation, which could have barred him from running for office. However, the appeals court overturned the decision and found him not guilty on all charges.
That was not the end. On May 1, the Supreme Court’s full bench sent the case back for retrial with a guilty ruling.
The court said all 12 justices read through the 60,000-page case file in just four days. However, the Seoul High Court delayed the retrial until after the election, allowing Lee to run for president.
③ Scaling the National Assembly Fence on the Night of Martial Law
President-elect Lee stood in front of the National Assembly fence on the night of December 3, 2024. It was dark, and no one knew when soldiers might appear.
Then-President Yoon Suk-yeol had declared martial law that day, seemingly out of nowhere.
In his autobiography “The People Do It in the End,” published in April, Lee recalled that night, writing, “I blurted out ‘He’s insane’ and urgently typed just three words—‘To the Assembly’—into the Democratic Party’s Telegram chatroom.”
Riding in a car driven by his wife, Kim Hye-kyung, Lee headed to the National Assembly. Thinking it was vital to inform citizens as quickly as possible, he began a live stream on his YouTube channel “Lee Jae-myung TV.”
In his autobiography, he recalled the broadcast that began with “Citizens of Gwangju,” remembering the weeping families of the May 18 Gwangju Massacre victims “branded into my heart.” He wrote, “How could a few lawmakers stop armed soldiers? If I’m arrested, at least citizens can witness it if I’m live-streaming.”
His climb over the Assembly wall was broadcast live on YouTube.
At the time, “Lee Jae-myung TV” had around 1.07 million subscribers, but the video was viewed more than 2.4 million times by the morning of December 4, 2024.
Thanks to Lee’s fence climb and the mobilization of both Democratic Party and some People Power Party lawmakers, the Assembly barely managed to repeal Yoon’s martial law. Afterward, Lee declared, “Yoon Suk-yeol is no longer the president,” and began taking control of the political narrative.
Although the subsequent political turbulence continued—due to the failure of Yoon’s impeachment, his release, and delays by the Constitutional Court—Lee effectively led the country through the six-month crisis.
#LeeJaeMyung #KoreanPolitics #2025Election #DemocraticParty #SouthKoreaPresident #YoonSukYeol #MartialLaw #Prosecution #CivilActivism #PresidentialVictory
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- Kumho Petrochemical Emerges as Top Value Stock, Faces Growth Test
- Kumho Petrochemical has been included in the Korea Value-Up Index, a program led by the Korea Exchange to recognize companies with strong corporate value, solidifying its status as a leading value stock in the petrochemical industry.
Park Jun-kyung, President of Kumho Petrochemical, now faces increased responsibility to not only expand the company’s specialty chemicals business and enhance shareholder returns, but also to fend off any future threats to management control.
On June 3, Kumho Petrochemical announced plans to further boost its corporate value following its inclusion in the Korea Value-Up Index the previous day. The Korea Value-Up Index is part of the Korea Exchange’s initiative to channel capital toward companies with strong fundamentals. Among major petrochemical firms, Kumho Petrochemical was the only one to be selected.
Companies are chosen for the index based on profitability, shareholder return policies, market valuation, capital efficiency, and their disclosure of value-up strategies. Kumho Petrochemical met the criteria through its share buybacks, share cancellations, and public commitment to enhancing corporate value.
Between 2021 and 2025, the company repurchased 11,496,238 common shares and canceled 7,952,404 of them, worth approximately KRW 472.0 billion (US$ 328.2 million). This means the company bought back about one-third of its 34,411,991 total shares and canceled 70% of those repurchased.
In February, Kumho Petrochemical also unveiled a “Corporate Value Enhancement Plan,” which outlined key goals such as a 6% annual sales growth rate, a return on equity (ROE) of over 7% by 2026, and maintaining a shareholder return ratio of 30–40% of net income on a standalone basis through 2026.
The company also laid out three main strategies for growth: strengthening eco-friendly automotive solutions, expanding bio and sustainable materials, and accelerating the shift to high-margin specialty products.
With these efforts, Kumho Petrochemical became the only major petrochemical company added to the Korea Value-Up Index during the regular review cycle.
A company representative stated, “Our long-standing efforts to enhance corporate value have been recognized,” adding, “We will continue expanding shareholder returns based on our three growth strategies.”
However, industry insiders point out that such proactive policies may be driven by the need to defend against internal threats to management.
Park Jun-kyung’s cousin, Park Chul-wan, a former executive at Kumho Petrochemical, challenged the leadership in shareholder meetings in 2021, 2022, and 2024, opposing Chairman Park Chan-koo—Park Jun-kyung’s father—through a series of shareholder proposals. This so-called “nephew rebellion” centered around demands related to shareholder value, such as higher dividends and increased share cancellations.
In 2021, Park Chul-wan proposed a dividend of KRW 11,000 per common share and KRW 11,050 per preferred share, more than double the company’s actual proposal of KRW 4,200 and KRW 4,250 per share, respectively.
In 2024, Park Chul-wan allied with Cha Partners Asset Management to submit proposals at the annual shareholder meeting that included amending the company charter to allow share cancellations by shareholder resolution alone, and canceling 50% of treasury shares by the end of 2024 and the remaining 50% by the end of 2025.
Although these proposals were rejected due to concerns over future growth, the company responded by ramping up its corporate value efforts starting in 2021.
When Park Jun-kyung was appointed internal director in 2022, he stated, “The management and all employees will unite to focus on the company’s core mission—enhancing shareholder value.”
While Park Chul-wan did not make any shareholder proposals at this year’s meeting and has ended his alliance with Cha Partners, the management dispute may not be fully resolved. He still holds 8.82% of the company’s shares, making him the largest individual shareholder.
According to Korea’s Financial Supervisory Service disclosures, Park Jun-kyung holds a 7.40% stake, while Chairman Park Chan-koo holds 6.92%. Park Jun-kyung’s younger brother, Vice President Park Ju-hyung, began actively buying shares late last year and has increased his stake to 1.08%. Still, the combined stake of Park Jun-kyung and related parties remains at around 16%.
Given the potential for future challenges similar to the “nephew rebellion,” it is critical for Kumho Petrochemical to strengthen its base of friendly shareholders through enhanced shareholder returns.
To fund these returns, Park Jun-kyung is expected to intensify efforts to grow the company’s high-margin specialty chemicals business.
This year, he completed expansions of EPDM (ethylene propylene diene monomer) and MDI (methylene diphenyl diisocyanate) production. Last year, the company boosted its nitrile butadiene (NB) latex capacity from 710,000 tons to 940,600 tons.
The NB latex expansion is expected to generate significant benefits, especially as the U.S. imposes higher tariffs on Chinese-made latex gloves.
In synthetic rubber, the company has decided to convert general-purpose production lines to SSBR (solution styrene-butadiene rubber), a high-value, eco-friendly product used in electric vehicle tires.
In advanced materials, Kumho Petrochemical established a 360-ton capacity for carbon nanotube (CNT) production last year and is expected to begin full-scale commercial production this year. CNTs, which enhance electrical conductivity, are used in batteries and could help boost the company’s share in the secondary battery market.
Thanks to its specialty focus, Kumho Petrochemical stood out as the only one among Korea’s “Big Four” petrochemical firms to post strong earnings in the first quarter.
In Q1 2024, Lotte Chemical recorded an operating loss of KRW 126.6 billion (US$ 88.1 million), LG Chem lost KRW 56.5 billion (US$ 39.3 million) in its petrochemical division, and Hanwha Solutions posted a KRW 91.2 billion (US$ 63.4 million) loss in its chemical segment.
Jeon Yu-jin, a researcher at iM Investment & Securities, said, “Kumho Petrochemical is showing the most stable performance in the petrochemical sector,” adding, “It’s a company investors can count on across all fronts—market conditions, performance, financial structure, and shareholder policy.”
#KumhoPetrochemical #KoreaValueUpIndex #ParkJunKyung #shareholderreturns #specialtychemicals #CNT #NBlatex #EPDM #SSBR #managementdispute
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- Salesman No.1 Kang Seong-muk Eyes Hana Financial Chair with Sales DNA
- “Salesman No.1.” That’s the phrase proudly displayed on the business card of Kang Seong-muk, CEO of Hana Securities.
It’s also a favored term within Hana Securities to describe Kang, a reflection of both his identity and pride as the top sales expert within Hana Financial Group.
This identity also serves as a keyword that encapsulates Kang’s management style. He places a strong emphasis on field operations and direct communication with customers. On March 26, 2025, he even answered customer calls himself, taking part in a company event called “Customer Voice Experience Day.”
Since joining Hana Bank in 1993, Kang has built his expertise in field-oriented roles, including Head of the Sales Support Group and Head of the Central Sales Group. He has consistently grown as a person deeply embedded in sales.
Kang is also emerging as a strong contender in the race for the next chairman of Hana Financial Group. In December 2024, he officially stepped into the race after being shortlisted as an internal candidate by the Chairman Candidate Recommendation Committee, alongside current Chairman Ham Young-joo and Vice Chairman Lee Seung-yeol.
With Chairman Ham’s term not ending until March 2028, how Kang leads Hana Securities could become a critical factor in the group’s next leadership decision.
◆ The Gateway to the Chairmanship: Mega IB License and Profit Recovery
Two key items are considered decisive in the race for Hana Financial Group’s next chairman: obtaining a mega investment bank (IB) license and achieving a turnaround in performance.
On April 9, the Financial Services Commission announced its “Plan to Enhance Corporate Finance Competitiveness in the Securities Industry,” stating that it would accept applications in the third quarter of this year to designate comprehensive investment firms with KRW 4 trillion (US\$ 2.8 billion) and KRW 8 trillion in capital based on current requirements.
A mega IB license is granted to securities firms with capital exceeding KRW 4 trillion (US\$ 2.8 billion), allowing them to raise and operate funds up to twice their capital through short-term notes. This enables expansion into high-return sectors like corporate finance and global infrastructure investment.
For Hana Securities, securing this license is a crucial step toward transforming its revenue model. If Kang has his sights set on the chairmanship, this achievement is seen as a strategic milestone he must reach.
Hana Securities already meets the capital requirement for the mega IB license, with capital of KRW 5.961 trillion (US\$ 4.1 billion) as of the end of 2024.
However, a blemish remains. The Financial Supervisory Service imposed a fine of around KRW 3 billion (US\$ 2.1 million) and an institutional warning after discovering the company had recycled bonds in wrap accounts and money trust accounts. Such warnings are classified as serious disciplinary actions and restrict new business ventures for a year.
Nevertheless, some believe the penalty may not pose a significant obstacle to obtaining the license. The fact that the penalty was downgraded from an initially expected business suspension by two levels is seen as a positive signal.
◆ A Return to Profit in 2024, But the Road Is Still Long
Kang’s first year as CEO in 2023 was not an easy one.
That year, Hana Securities recorded an operating loss of KRW 366.7 billion (US\$ 255.1 million) and a net loss of KRW 288.9 billion (US\$ 200.9 million), primarily due to defaults in real estate project financing (PF).
Kang quickly restructured the portfolio, focusing on asset management and traditional corporate finance. Moving away from a real estate-heavy model to a more balanced business structure, the company achieved a turnaround in 2024 with KRW 141.9 billion (US\$ 98.7 million) in operating profit and KRW 223.9 billion (US\$ 155.8 million) in net profit on a consolidated basis.
Still, considering the high expectations Hana Financial Group has for Hana Securities, some view this as only a “partial success.”
Chairman Ham has consistently emphasized strengthening the group’s non-banking sector. Yet in 2024, Hana Securities’ net profit was just one-fifteenth that of Hana Bank.
Hana Bank, a core affiliate of Hana Financial Group, posted KRW 4.5469 trillion (US\$ 3.2 billion) in operating profit and KRW 3.3686 trillion (US\$ 2.3 billion) in net income in 2024.
◆ Leadership Expansion Through Organizational Culture Reform
In the financial industry, Kang’s customer-centric philosophy—rooted in his identity as a salesman—is seen as a potential driving force behind Hana Securities’ performance improvement.
Kang is working to embed his “salesman spirit” throughout the company. At the beginning of 2025, it was reported that all executives were instructed to include “Salesman” on their business cards, following Kang’s example.
Hana Securities is trying to improve its business portfolio by reducing the proportion of real estate finance and increasing its focus on asset management—a field where direct customer contact is essential. It’s a perfect stage for Kang’s philosophy to shine.
In December 2024, the company launched the WM Innovation Division as a control tower for sales and reorganized the PWM Sales Division to provide tailored services for high-net-worth clients. It also established a Retirement Sales Office to expand pension-related services.
Sales has truly become embedded in every aspect of the organization.
An industry insider remarked, “Kang Seong-muk not only leads Hana Securities but also bears the task of proving himself as a leader for Hana Financial Group. It remains to be seen what changes his leadership—anchored in the identity of a salesman—will bring to Hana Securities.”
#KangSeongmuk #HanaSecurities #HanaFinancialGroup #SalesLeadership #MegaIB #FinancialTurnaround #NonBankingExpansion #CustomerCentric #AssetManagement #KoreanFinance
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- GS E&C Targets Profit Recovery—Huh Yoon-hong Bets on GS Inima Sale
- GS E&C is projected to recover its quarterly operating profit to pre-Incheon Geomdan accident levels from the second quarter of 2023.
CEO Huh Yoon-hong of GS E&C is working to improve the company’s financial structure by pursuing the sale of its water treatment subsidiary, GS Inima, which is estimated to be worth up to KRW 2 trillion (US$ 1.44 billion).
If the sale of GS Inima is successful, it is expected to serve as a foundation for enhancing GS E&C’s bidding competitiveness in urban redevelopment projects—a key focus for CEO Huh.
According to sources inside and outside GS E&C on May 28, the company is expected to see a clear trend of profitability improvement starting from the second quarter.
According to financial information provider FnGuide, major securities firms forecast that GS E&C will record consolidated revenue of KRW 3.22 trillion (US$ 2.32 billion) and operating profit of KRW 100 billion (US$ 72.1 million) in the second quarter.
This would be a 2% decline in revenue compared to the same period last year, but a 17% increase in operating profit. The projected operating margin is 3.1%, up 0.3 percentage points from a year ago.
GS E&C explained that the increase in operating profit for the second quarter will be due to the reflection of contract cost increases at redevelopment sites where construction cost disputes had occurred, and a structural reduction in the share of past high-cost projects.
On this day, some securities firms even suggested that GS E&C could significantly exceed market expectations (consensus) for the second quarter. IBK Investment & Securities projected GS E&C’s second-quarter operating profit to surpass KRW 150 billion (US$ 108.2 million).
According to GS E&C, this analysis is based on the fact that additional costs amounting to KRW 130.8 billion (US$ 94.3 million) from the Maple Xi and Cheolsan Xi The Heritage projects will be reflected in second-quarter results, along with stronger-than-expected earnings from the Thu Thiem development project in Vietnam.
A quarterly operating profit of KRW 150 billion (US$ 108.2 million) would mark the first time GS E&C has exceeded that level since the first quarter of 2023, before the collapse of an underground parking lot at an Incheon Geomdan apartment site in April 2023.
Since recording KRW 158.9 billion (US$ 114.6 million) in consolidated operating profit in Q1 2023, GS E&C has failed to exceed KRW 100 billion (US$ 72.1 million) in any quarter.
After becoming CEO of GS E&C, Huh Yoon-hong focused on cost restructuring at construction sites, brand renewal for restoring trust, and concentrating on core competencies, especially in housing. These efforts now appear to be bearing fruit in terms of performance.
While the construction industry is highly focused on nuclear power plant projects—both large-scale and small modular reactors (SMR)—and large-scale development projects, GS E&C has shown relatively little activity in these areas.
In this context, recovering operating profit to pre-accident levels through housing projects becomes the top priority for CEO Huh.
With a strong likelihood of a clear upward trend in operating profit, CEO Huh is expected to further accelerate efforts to improve the financial structure through the sale of GS Inima.
Moreover, the GS Inima sale is viewed as more than just a financial restructuring—it is also considered a key factor for enhancing bidding competitiveness in future urban redevelopment projects.
GS E&C is currently pursuing a full sale of its 100% stake in GS Inima to TAQA, a state-owned energy company in the United Arab Emirates (UAE), as a potential buyer.
The sale of GS Inima, which had seen little progress for about a year, has gained momentum in 2024 with the emergence of identified buyers and the start of the second round of due diligence.
According to overseas media including MEED, a Middle Eastern business publication, GS Inima’s total corporate value is estimated at around KRW 2 trillion (US$ 1.44 billion).
With the KRW 2 trillion (US$ 1.44 billion) sale of GS Inima, GS E&C is expected to significantly improve its financial structure by sharply lowering its debt ratio.
The securities industry anticipates that GS E&C’s standalone debt ratio could drop from 212% at the end of Q1 to the 160% range. This would return the ratio to near the end-of-2022 level of 158%, after staying above 200% since 2023.
In addition, the company is expected to recover a significant portion of its standalone net debt ratio, which rose from 23% at the end of 2022 to 54% at the end of Q1 2024. The net debt ratio represents the proportion of net debt to total capital.
If GS E&C's financial stability improves and leads to a credit rating upgrade, it could boost its competitiveness in future urban redevelopment bidding wars such as in Apgujeong and the Seongsu Strategic Redevelopment Zone.
GS E&C’s credit rating for unsecured bonds was downgraded from A+ to A in February 2024 following the Geomdan accident.
The downgrade was primarily due to increased business and financial volatility and debt burden resulting from the accident and subsequent cost adjustments. However, maintaining solid business performance and reducing debt are key factors that could lead to a credit rating upgrade.
If the credit rating improves, GS E&C can offer lower guarantee rates during bidding, providing better financial terms to redevelopment and reconstruction cooperatives.
In major bidding competitions, such as the redevelopment of Hannam District 4 in Yongsan-gu, Seoul, selected in January, and the currently contested redevelopment of Yongsan Maintenance Base Area Section 1, construction companies are actively offering aggressive financial packages to win over cooperative members.
GS E&C is currently focusing on winning the redevelopment project in Seongsu District 1 within the Seongsu Strategic Redevelopment Zone and is also exploring opportunities in the Apgujeong reconstruction zone.
Notably, the redevelopment of Seongsu District 1, which is also attracting interest from Hyundai E&C and HDC Hyundai Development Company, may serve as CEO Huh’s debut bid in the urban redevelopment market.
Jung Hyun Cho, a researcher at IBK Investment & Securities, stated, “Among large construction companies with similar brand power and site management capabilities, credit strength will determine bidding competitiveness,” and added, “If GS E&C’s credit rating improves, it will likely become a core element in enhancing new project bidding power.”
#GSE&C #HuhYoonhong #GSInima #FinancialRestructuring #OperatingProfitRecovery #UrbanRedevelopment #ConstructionIndustry #DebtRatio #CreditRating #KoreanConstruction
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- KT&G’s KRW 6 Trillion Milestone: A New Global Path Beyond Bang Kyung-man’s Predecessor
- “I will do my utmost to proactively lead innovation and seize future growth opportunities so that KT&G can rise as a global top-tier company.”
This was what KT&G CEO Bang Kyung-man said in February 2024, after being confirmed as the company’s new CEO. And throughout 2024, CEO Bang proved his statement with real results.
However, some say that the remaining two years of his term are far more important than the past year. This is because KT&G's 2024 performance is also evaluated as the result of the roadmap established by his predecessor, former CEO Baek Bok-in.
◆ KT&G’s Top Global Expert
KT&G CEO Bang Kyung-man is considered one of the group’s top global strategists.
From 2015, he led KT&G’s global division for about six years and spearheaded the company’s global strategy. During this time, the number of countries KT&G entered expanded from around 40 to about 100.
He also succeeded in localizing strategies by building market-specific brand portfolios, which laid the groundwork for KT&G to surpass KRW 1 trillion (US$ 721 million) in overseas sales for the first time.
He didn’t just increase the number of countries entered but tailored strategies for each market, achieving successful localization. This is why he is regarded as the person who best understood and executed the globalization of KT&G.
◆ A Successful Start to the ‘Bang Kyung-man Era’ in 2024, Leading a Rebound After Four Years
The year 2024 marked Bang Kyung-man’s first official year as CEO. From the moment he took office, he instilled a global strategic mindset across the organization and achieved measurable results in his first year.
KT&G recorded increases in both revenue and operating profit in 2024 compared to the previous year—a feat not achieved in four years.
In 2024, KT&G posted consolidated revenue of KRW 5.9088 trillion (US$ 4.26 billion) and operating profit of KRW 1.1888 trillion (US$ 857 million). Compared to 2023, revenue increased by 0.79% and operating profit by 1.84%.
In particular, the overseas business segment delivered remarkable results, with strong performance in cigarette exports helping to achieve record-high overseas sales.
KT&G generated overseas sales of KRW 2.0731 trillion (US$ 1.49 billion) in 2024, a 15.4% increase from 2023.
The experience and market insight that CEO Bang Kyung-man accumulated while leading the global division for years are now reflected in KT&G’s overall business performance.
◆ The ‘Bang Kyung-man Era’—The Real Evaluation Begins Now
Of course, the success in 2024 cannot be attributed solely to CEO Bang Kyung-man’s leadership. Some analyses suggest that the results were based on the business portfolio established by former CEO Baek Bok-in over many years.
Indeed, former CEO Baek consistently emphasized the importance of overseas business.
When he took office in 2015, Baek stated, “We will focus on exploring emerging mega-markets through the overseas tobacco business to sustain growth.” At KT&G’s 30th anniversary celebration in March 2017, he stressed, “We will lead a second leap forward through exports and business innovation.”
At the 35th regular general shareholders’ meeting in March 2022, Baek said, “We will maximize sales and profits through expansion of the e-cigarette overseas market and cost reductions,” adding, “We will focus the capabilities of overseas subsidiaries on revitalizing the conventional cigarette business in the Middle East and Asia-Pacific markets to generate results.”
Therefore, the increase in KT&G’s overseas sales in 2024 is seen by some as a continuation of the business direction pursued since Baek Bok-in’s tenure.
◆ Aggressive Investment in the Middle East and Africa—Will Bang Kyung-man Lead KT&G Into the KRW 6 Trillion Era?
CEO Bang Kyung-man is leveraging his capabilities as a global strategist to expand KT&G’s international foothold through aggressive investment.
In January 2025, Bang announced that KT&G had established a new subsidiary in Uzbekistan and would expand its plant in Türkiye.
The plant expansion in Türkiye is particularly noteworthy. According to KT&G, this expansion will raise the annual tobacco production capacity in Türkiye to a maximum of 12 billion cigarettes.
KT&G plans to use the Türkiye plant expansion to transform it into a hub for export networks extending from the Middle East to Africa and Latin America.
The financial market anticipates that CEO Bang Kyung-man’s global management efforts will yield significant results.
Hanwha Investment & Securities predicts that KT&G will achieve consolidated revenue of KRW 6.521 trillion (US$ 4.70 billion) and operating profit of KRW 1.358 trillion (US$ 979 million) in 2025. This represents a 10.4% increase in revenue and a 14.3% increase in operating profit compared to 2024.
An industry insider stated, “KT&G has never surpassed KRW 6 trillion in revenue,” adding, “If CEO Bang Kyung-man can exceed that in 2025 as expected by the consensus and guidance, it will mark a major milestone in KT&G’s history.”
#BangKyungman #KT&G #GlobalStrategy #KT&GRevenue #KT&GLeadership #TobaccoExports #TurkiyeFactory #KRW6TrillionEra #KoreanBusiness #GlobalCEO
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- SK’s Chey Tae-won Set to Cut Debt Below KRW 5 Trillion, But Hacking Crisis Threatens
- Chairman Chey Tae-won of SK Group has been continuing the group's asset rebalancing efforts by selling non-core assets for nearly two years, and the impact of this initiative is expected to become evident this year.
SK, the group's holding company, is projected to reduce its net debt from over KRW 10 trillion (US$ 7.2 billion) at the end of 2024 to around KRW 5 trillion (US$ 3.6 billion) by the end of this year—cutting it nearly in half.
However, the unexpected USIM hacking incident at SK Telecom, the group’s main cash generator, is raising concerns about potential financial instability.
As of March 2025, SK had already reduced its net debt to KRW 8.1 trillion (US$ 5.8 billion) from KRW 10.52 trillion (US$ 7.6 billion) at the end of 2024, accelerating financial restructuring through rebalancing.
In March, SK sold its specialty gas subsidiary SK Specialty for KRW 2.63 trillion (US$ 1.9 billion), and in the second quarter, it plans to sell its Pangyo Data Center to affiliate SK Broadband for KRW 506.8 billion (US$ 365.5 million).
Recently, it also secured approximately KRW 300 billion (US$ 216.3 million) by selling a 64.81% stake in Vietnamese pharmaceutical company Imexpharm to China's Livzon Pharmaceutical Group.
SK is also pushing to sell semiconductor wafer maker SK Siltron.
It is currently negotiating with private equity firm Hahn & Company to sell its 70.6% controlling stake in SK Siltron. If the deal closes, SK is expected to secure over KRW 3 trillion (US$ 2.2 billion) in cash. SK Siltron is estimated to have a corporate value of up to KRW 5 trillion (US$ 3.6 billion).
Choi Gwan-soon, a researcher at SK Securities, said, “If SK Siltron is sold within this year, SK’s net debt could fall from KRW 10.5 trillion (US$ 7.6 billion) at the end of last year to below KRW 5 trillion (US$ 3.6 billion) by year-end,” adding, “The inflow of cash from rebalancing could be partly used for shareholder returns.”
This would be the first time in four years that SK’s borrowings fall below KRW 10 trillion (US$ 7.2 billion) since 2021.
However, the hacking incident at SK Telecom could disrupt this progress in financial restructuring.
SK Telecom’s management has said it is still difficult to quantify the financial impact of the breach, but concerns are rising about possible dividend reductions due to deteriorating earnings.
SK holds a 30.57% stake in SK Telecom and received approximately KRW 230 billion (US$ 165.9 million) in dividends from it in 2024.
Shin Eun-jung, an analyst at DB Financial Investment, stated, “We have lowered our 2025–2026 operating profit forecasts for SK Telecom by 10% each, reflecting factors like subscriber losses and compensation expenses.” She added, “Apart from the estimated KRW 45 billion (US$ 32.5 million) in revenue loss due to a net subscriber decrease of 250,000 to 350,000 in Q2 and KRW 100 billion (US$ 72.1 million) in USIM replacement costs, there may also be dealer compensation and regulatory fines.”
If the government allows waiver of early termination fees for SK Telecom customers, the company could suffer losses amounting to several trillion won.
Ryu Young-sang, CEO of SK Telecom, stated during a National Assembly hearing on May 8, “If termination fees are waived, up to 5 million subscribers could leave in a single month,” adding, “Including the value of three years’ worth of revenue per user, total losses could exceed KRW 7 trillion (US$ 5.0 billion).”
This means SK Telecom may no longer be able to continue serving as SK Group’s main cash generator in the near future. The Ministry of Science and ICT is expected to decide on the waiver issue by the end of June.
Public demand for increased investment in cybersecurity is also growing. SK Group invested about KRW 210 billion (US$ 151.5 million) in information security in 2023, but this only represents 5.3% of its total IT investment—far lower than the U.S. corporate average of 26%.
Chairman Chey Tae-won is expected to hold a second-half business strategy meeting from June 13 to 14 to review the group’s rebalancing status and discuss response measures to the hacking incident, including investment plans for cybersecurity.
Korea Ratings stated, “SK, as the group’s holding company, is easing its financial burden through the sale of non-core assets while enhancing its capacity to support affiliates,” adding, “However, financial pressure remains heavy as investment performance in newly launched businesses has continued to underperform.”
#CheyTaeWon #SKGroup #SKTelecom #RyuYoungSang #FinancialRebalancing #CybersecurityCrisis #SKSiltronSale #DividendRisk #USIMHack #KoreanConglomerates
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- Cho Man-ho’s Calculated Alarm—The Unsettling Math Beneath Musinsa’s Shining Results
- As Musinsa, the fashion platform, surpassed KRW 1 trillion (US$ 721 million) in annual sales and reached the peak of its external growth, CEO Cho Man-ho has once again shifted direction.
When Musinsa entered a company-wide emergency management system this past April, it sparked confusion and curiosity both inside and outside the industry.
However, a closer look at the first-quarter report offers clarity. Simply put, while both revenue and profit increased, inventory swelled, and cash declined.
Transaction volume fell short of internal targets, and weakened consumer sentiment added to growing uncertainty in performance.
Outwardly, the company appears to be growing, but internally, complications are surfacing. Observers suggest that now is not the time for greater scale, but for reassessing Musinsa’s fundamentals.
As of May 27, a comprehensive view of Musinsa's recent actions suggests that CEO Cho will likely focus more on financial stability than expanding external growth in 2024.
In the first quarter of this year, Musinsa recorded consolidated sales of KRW 292.9 billion (US$ 211.2 million) and operating profit of KRW 17.6 billion (US$ 12.7 million), up 12.6% and 24.0%, respectively, from the same period last year. On paper, Musinsa still looks like a thriving company.
But the internal structure behind those numbers tells a slightly different story. Warning signs are flashing when it comes to inventory, cash flow, and operational efficiency.
Musinsa’s inventory is growing rapidly, while its turnover rate is slowing. As of Q1 2024, the inventory of products from partner brands reached KRW 240.2 billion (US$ 173.2 million), and Musinsa Standard's inventory stood at KRW 197.1 billion (US$ 142.1 million). Compared to the previous year, product inventory increased by 16.9% and brand inventory by 38.7%.
The problem lies in poor sales performance. Inventory turnover dropped from 1.7 last year to 1.1 in Q1 2024, meaning it takes much longer to clear stock.
This is particularly concerning given that Musinsa’s core customer base—people in their 20s and 30s—are highly sensitive to trends and typically ignore out-of-season products.
Slow-moving inventory inevitably leads to discounting, which directly affects profitability and brand value. This rising inventory isn’t just a warehouse issue—it poses a complex risk to both Musinsa’s financial health and brand image.
A Musinsa spokesperson explained, “The increase in inventory was influenced by the proactive stocking of Musinsa Standard products to support offline store expansion,” adding, “In Q1, the fashion industry typically experiences a temporary sales slowdown due to the arrival of spring and summer collections, which also contributed to the inventory growth.”
Cash flow is also showing signs of strain. As of the end of Q1 2024, Musinsa’s cash and cash equivalents stood at KRW 425.9 billion (US$ 307.1 million), a decrease of about KRW 260 billion (US$ 187.4 million) from the end of last year. Operating cash flow turned negative, from KRW 456.9 billion (US$ 329.5 million) to -KRW 184.7 billion (US$ -133.2 million).
Though Musinsa posted accounting profits, its cash is draining—reflecting a structural issue. As a fashion platform, Musinsa faces high logistics and operating costs due to managing numerous brands and products while meeting customer expectations for fast delivery and returns.
The simultaneous increase in inventory and decrease in cash could potentially develop into a liquidity risk.
Some of this is seasonal. In the fashion industry, Q4 typically sees high sales and large brand settlement payments, which are then paid in Q1—explaining much of the cash outflow. Still, the shift to negative operating cash flow remains a worrying signal.
As such, Musinsa appears to be at a turning point. With its external growth trajectory set, the focus must now shift from speed to direction. CEO Cho seems to be confronting the next phase by prioritizing internal strength over continued expansion.
Since April, Musinsa has been fully operating under its emergency management system, which is continuing into Q2.
This includes weekend work for executives, organizational streamlining, and cost structure restructuring—efforts reflecting CEO Cho’s commitment to cutting inefficiencies while continuing key initiatives like offline expansion and global expansion.
A Musinsa representative stated, “Uncertainty from weakened consumer sentiment is expected to continue in Q2, and we are maintaining our emergency management system as a preemptive crisis response.”
Industry insiders view Musinsa’s actions not as simple austerity, but as a signal that the company is preparing for its IPO. Behind the scenes, Musinsa is reportedly working to select an underwriter.
Companies preparing to go public must demonstrate more than just sales growth—they must also prove financial soundness and operational efficiency. Therefore, the current emergency management approach is seen as a proactive move toward internal restructuring.
For platform businesses, early growth focuses on expanding scale and market share. But once a certain size is reached, true capability is measured by how efficiently assets are managed and converted into stable cash flow.
A Musinsa spokesperson said, “Amid ongoing consumption stagnation and economic uncertainty, we are consistently pursuing cost efficiency through the emergency management system,” adding, “However, we will continue planned investments in key growth drivers such as offline distribution expansion and global market entry.”
#Musinsa #ChoManho #FashionPlatform #EmergencyManagement #InventoryRisk #CashFlowCrisis #CorporateTurnaround #IPOPreparation #KoreanStartup #RetailStrategy
