Professional Documents
Culture Documents
Agenda
Supervisory Integration in 1999 Financial Services Commission (FSC) Financial Supervisory Service (FSS)
Structure of FSS FSS Funding & Expenditure FSS Mission Supervisory Functions of FSS
Q&A
Ministry of Finance and Economy (MOFE) had comprehensive authority to supervise the financial sector Bank of Korea (BOK) held responsibility for the banking sector Banks, securities firms, insurers, other NBFIs each under different supervisory authorities
MOFE
BOK BOK
Office of Bank Supervision Securities Supervisory Board Insurance Supervisory Board Non-Bank Supervisory Authority
Commercial Banks
Specialized Banks
Insurance Companies
MOFE
MOFE
Bank Supervisory Authority Financial Supervisory Commission Financial Supervisory Commission Financial Services Commission
FSS
FSS
~ 99
99 ~ 08
08 ~
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Related Organizations
Bank of Korea (BOK)
Issue bank notes and coins Formulate and implement monetary and credit policy Acting as banker to the banks Acting as banker to the government Lender of last resort (Independent from government)
Organization of FSC
Financial Services Commission
Securities & Futures Commission
Financial Policy Bureau Financial Policy Financial Market Analysis Industrial Finance Financial Restructuring International Finance International Cooperation Team
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FSC Composition
Commissioners (9) Chairman (ministerial level) & Vice Chairman 2 Standing Commissioners recommended by FSC Chairman 5 Non-standing Commissioners MOSF Vice Minister FSS Governor KDIC President BOK Deputy Governor Industry Representative recommended by KCCI Chairman Appointed by President for a 3-year term, renewable once Meets twice a month
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FSC Functions
Formulate financial policy
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SFC Composition
Five commissioners
Chairman: FSC Vice Chairman 1 Standing Commissioner recommended by FSC Chairman 3 Non-Standing Commissioners recommended by FSC Chairman
SFC Functions
Oversight of securities and futures markets
Accounting standards and audit review Pre-deliberation of capital market-related matters for full deliberation by the FSC
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Structure of FSS
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Executive Board
14 Executive Officers
Governor General Auditor First Senior Deputy Governor 2 Senior Deputy Governors 8 Deputy Governors Chief Accountant
FSS Organization
22 departments and 16 offices under 10 divisions
Strategic Planning Management Support and Consumer Protection Supervision Coordination Bank Supervision Non-Bank Supervision Insurance Supervision Financial Investment Supervision Corporate Disclosure Supervision Capital Market Investigation Accounting Review
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Governor
General Auditor (Internal Audit Office)
Financial Investment Supervision Division Financial Investment Department Capital Market Department Asset Management Department
Planning & Coordination Dept. Legal Affairs Office Macroprudentia l Analysis Dept. Research Office Public Affairs Office
General Affairs Department IT Strategy Office Human Resources Development Office Secretary Office Security Planning Office Consumer Protection Center Dispute Settlement Dept.
Supervision Coordination Department Financial Risk System Office Enforcement Review Office Financial Risk Examination Support Dept. International Cooperation Dept.
Bank Dept. 1
Mutual Savings Bank Dept. Loan Business Office Cooperative Finance Dept. Micro-loan Support Office
Life Insurance Department Insurance Actuary and Pension Office Non-life Insurance Department Insurance Investigation Office
Accounting Review Dept. 1 Corporate Accounting System Office Accounting Review Dept. 2
Bank Dept. 2
Bank Dept. 3
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Credit union and cooperatives : 2,397 Securities-Related Companies : 62 Securities Companies, 65 Asset
Management Companies etc.
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Sources of Income
(USD206million, 2008) Contributions from financial institutions under FSS supervision (77%) Fees for securities issuance (17%) Contributions from BOK (4%) Other (2%)
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FSS Expenditure
General Expenses (97.4%)
Wages and Administrative Expenses (91.9%)
Provisions for Post-retirement Benefits (8.1%)
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FSS Mission
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Bank Supervision
1. Entry Regulations
General Requirements Fit & Proper Test Ownership Restrictions(4%, 10%)
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d. Credit Restrictions
Single borrower: less than 20% of equity Single business group: less than 25% of equity Large credit: less than 500% of equity
(Large credit: extended credit exceeding 10% of equity)
e. Liquidity ratios
Liquid assets to liquid liabilities: more than 100%
For foreign currency : more than 85% Liquidity: remaining maturity of less than 3 months
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Non-Bank Supervision
1. Entry Regulation 2. Prudential Regulation
a. b. c. d. e. f. g. h. Capital Adequacy Asset Classification and Provisioning Controls on Credit Concentration and Connected Lending Liquidity Holding of Reserve Requirement Assets Restriction on Acquisition of Real Estate Securities Investment Limit Financial Disclosure
3. Management Evaluation System 4. Prompt Corrective Action 5. On-site Examination & Off-site Surveillance
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Banking Act
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Application of different laws for same financial functions Positive System Concurrent engagement restricted Unprotected investor
Restricting financial investment products development Barrier to raising competitiveness through synergy effect Undermining investor confidence
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Insurance Supervision
1. Entry Regulation
Capital Requirement Business Funds to be Paid by Foreign Insurers Requirements for Permission Maintenance of Manpower and Physical Facilities
2. Prudential Regulation
Solvency Margin (Risk Based Capital) Asset Classification and Provisioning
3. Management Evaluation System 4. Prompt Corrective Action (Based on Solvency Ratio) 5. On-site Examination & Off-site Surveillance
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Consumer Protection
Consumer Complaint Handling Dispute settlement
Request for dispute mediation Examination and discovery Dismissal/mutual agreement or deliberation by the Financial Dispute Settlement Committee
Consumer education
Online consumer protection section on the FSS website Lectures and seminars
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Q&A
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Website: english.fss.or.kr
E-mail: fssintl@fss.or.kr
Telephone: +82-2-3145-7906
Fax: +82-2-3145-7899
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