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Photo courtesy of Yonhap News |
[Alpha Biz= Paul Lee] SEOUL, September 18, 2025 – More than 1,000 employees of South Korea’s Financial Supervisory Service (FSS) took to the streets on Wednesday, protesting a government-led plan to restructure the country’s financial oversight system. It marked the first large-scale street protest by FSS staff in 17 years.
Wearing black attire and red headbands, some 1,100 protesters gathered in front of Korea Development Bank’s headquarters in Yeouido, chanting slogans such as “Stop dismantling the FSS” and “No to the separation of the Financial Consumer Agency.” Lawmakers Kang Min-guk and Kim Jae-seop of the National Assembly’s Political Affairs Committee also joined the rally.
The FSS Emergency Committee issued a statement denouncing the reform proposal, saying:
“Separating financial consumer protection and designating the FSS as a public institution is nothing more than a political power grab. It undermines supervisory independence and weakens consumer protection.”
The committee further criticized the speed of the legislative process, noting that over 50 laws and 9,000 provisions would require amendment:
“To claim this can be reviewed in just two days is reckless,” the statement said, calling for an immediate halt to the task force handling the legislation.
Some employees warned that so-called “Mofia” – entrenched bureaucrats from economic ministries – were attempting to consolidate control over both financial policy and supervision.
The protest comes after the Democratic Party proposed a sweeping overhaul bill to dismantle the Financial Services Commission (FSC), transfer financial industry policymaking to a new Ministry of Economy and Finance, and establish a new Financial Supervisory Commission. Under the proposal, the FSS’s consumer protection and market conduct oversight functions would be spun off into a new Financial Consumer Agency.
The employees urged President Lee Jae-myung to listen to their concerns and called on the National Assembly to strengthen oversight, including public hearings and performance reviews of consumer protection functions.
Meanwhile, the Lee administration convened its first expanded macro-financial policy meeting, also known as the “F4 Meeting,” at the Federation of Banks building in Seoul. Deputy Prime Minister Koo Yoon-cheol, FSC Chairman Lee Ok-won, FSS Governor Lee Chan-jin, and Bank of Korea Deputy Governor Yoo Sang-dae attended, with BOK Governor Rhee Chang-yong joining virtually from Washington. Participants agreed that the U.S. Federal Reserve’s recent 0.25 percentage-point rate cut would have only a limited impact on Korea’s financial markets.
알파경제 Paul Lee 특파원(hoondork1977@alphabiz.co.kr)
