Financial Supervisory Service Governor Lee Chan-jin attends a full meeting of the National Policy Committee held at the National Assembly on the 5th and watches remarks on procedure by lawmakers from both the ruling and opposition parties. Yonhap News

Financial Supervisory Service Governor Lee Chan-jin, prefacing that it was his personal view, said, “There is a need to make the FSS a state institution.”

At a work report to the National Policy Committee of the National Assembly on the 5th, when Rep. Lee In-young of the Democratic Party of Korea asked about the recently debated nature and status of the FSS, he said, “Personally, the most desirable option is to make it a state institution like the U.S. Securities and Exchange Commission (SEC) or the Japanese Financial Services Agency, which I believe leaves the least room for dispute.”

He added, “However, if you look at the fundamental background to the establishment of the FSS, it was the International Monetary Fund situation (the foreign exchange crisis),” and explained, “Given that independence from the government, autonomy, and expertise were emphasized at its launch, it was hard to call it a private-sector body, so it was termed a special corporation without capital.” He went on, “It may not be quite apt to compare it to the Bank of Korea, but there is a particularity in that it was set up with similar emphases on independence and expertise, so it is necessary to take that into account in approaching this.”

On this point, Rep. Lee said, “As it relates to finance, whether the FSS is going to become something like the Board of Audit and Inspection, the prosecution, or the police, or become something akin to the Bank of Korea, it would be better to set a long-term direction and position it accordingly.”

He continued, “Even if special judicial police are given the authority to open investigations in order to respond quickly to financial crimes, especially stock-price manipulation, that is only a temporary measure,” adding, “In the long term and strategically, it would be right to establish the fundamental position of the FSS.”

Recently, the Public Institution Steering Committee of the Ministry of Economy and Finance raised the possibility of designating the FSS as a public institution, but it ultimately avoided that. Lee had also expressed opposition at the time to such designation. However, as the need has grown to strengthen the status of the FSS along with its public role, his remarks are interpreted as citing examples such as the U.S. SEC, which is guaranteed considerable independence from the president·the executive branch.