Nobody Wants to be President of Korea’s Number One Securities Company

“The president of Korea’s top securities company is lower than a branch manager of a foreign company?”

It has been revealed that managers of Seoul branches of some foreign securities companies have refused offers by Woori Financial Group to become president of Korea’s largest security company, a combination of LG Investment and Securities and Woori Securities.

In an October 11 interview, Kim Jong-wook, vice president of Woori Financial Group, said, “We have asked Lee Jae-woo of Lehman Brothers and Yang Ho-chul of Morgan Stanley to join us, but both refused.”

The branch managers of foreign securities firms are refusing the offers because they know the hardships of managing a combined securities company.

Vice President Kim said, “It is a heavy load for management to consider the restructuring problems.” Branch managers of foreign companies agree.

Lee Chan-keun of Goldman Sachs confirmed his refusal of the position, saying he “does not have the credentials.”

Vice President Kim retorted, “Who would want to come to a Korean securities company when management is difficult due to an over-powerful labor union, and when a foreign company gives better treatment?”

Kim pointed out four qualities—affinity with the labor union, business connections, IB experience, and foreign language skills—as the necessary qualifications of the combined security company’s CEO.

The launching of the combined company, which once seemed possible by the end of the year, will be delayed to next year because they are unable to find a CEO.

Kim said, “We will form a merger committee and will sign a merger contract in November,” and added, “We are planning to complete the merge by February.”

Will there be restructuring after the merger?

“We will not fire workers by force. If we raise our goals and implement a difference in bonuses, there will naturally be a restructuring effect.”

The combined securities firm will focus on business finance.

“There will be a synergy effect if Woori Bank hands over ABS works to the securities company when doing project financing,” he said.

legman@donga.com