South Korean policy bank unions rally as study urges keeping KDIC in Seoul

Labor unions at South Korea's major financial public institutions intensified opposition to the government's second-phase relocation plan on the 11th, with KDB, IBK and KEXIM holding a rally in Seoul and the KDIC union presenting research arguing the deposit insurer should remain in the capital. The unions said dispersing policy-finance bodies from Seoul to regions under review such as Busan, Daejeon, Jeonju, Naju and possibly Sejong could weaken support for advanced industries, SMEs and financial stability. The KDIC study said proximity to regulators, financial firms and the central bank matters more as digital bank runs compress crisis response times, while workforce data pointed to attrition risks: KDB resignations rose sharply in 2022-2023, and a KDIC survey indicated only about 24% of staff would stay after relocation, including 12% of employees with less than five years of service. The unions said they could pursue a general strike, litigation and challenges under the revised Yellow Envelope Act if the review continues.

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