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FSC chief-inauguration

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(Globalpost/GlobalPost)

SEOUL, March 22 (Yonhap) -- The new head of South Korea's financial pledged Friday to overhaul the governance structure of the country's major financial holding companies as part of an effort to improve their management.

The Financial Services Commission (FSC) will launch a task force to come up with measures to improve the way the major bank holding companies are governed, Shin Je-yoon said his inaugural ceremony.

"The original purpose of a financial holding firm -- to establish independent management between affiliates and prevent the possible spread of risks -- has faded. We'll come up with measures to change it," he said.

Shin, a former vice finance minister, officially took the helm of the country's top financial regulatory body after the National Assembly passed a government reorganization bill earlier in the day.

"We'll thoroughly look into fundamental problems and take all necessary means to change it," he said.

Shin also promised to shore up policy-lending to help smaller companies grow amid a slowing economy, in step with President Park Geun-hye's line of policy.

"I'll work to strengthen the roles of policy financing so that both start-ups and those smaller firms with growth potential get the tailored financial support," he said.

His pledge comes as the new government has put its top policy priority on helping small and medium enterprises (SMEs) grow. President Park Geun-hye has promised to boost support for smaller firms, urging related authorities to draw up measures.

Smaller companies here have been struggling to secure channels to raise capital since their borrowing costs have soared amid the jittery economic conditions. Few of them have been able to raise money through issuing stocks and bonds.

"The FSC will look into ways for SMEs to be able to take risks in direct financing, for example, by fueling KOSDAQ and alternative KONEX markets," Shin said.

KOSDAQ is a tech-oriented secondary market in Korea, and KONEX is another alternative bourse approved by the FSC recently to open within this year, designed for smaller firms only to help them raise funds.

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http://www.globalpost.com/dispatch/news/yonhap-news-agency/130322/fsc-chief-inauguration