In a move aimed at bolstering its image as a trustworthy financial institution, Woori Bank, one of South Korea’s largest commercial lender, has announced a series of initiatives to enhance its private banking services.
During a press conference on Thursday, the bank outlined its commitment to expanding its footprint in the asset management sector, an area plagued by trust issues within the banking industry.
As part of its strategy, Woori Bank has assembled a team of experts from various sectors, including tax, foreign exchange, and real estate. The bank is also introducing an artificial intelligence-based market prediction system, “Wise,” to provide tailored consultancy services that meet the unique needs of individual clients.
Moreover, Woori Bank plans to significantly increase the number of its asset management centers to 20 within the next three years. Operating under the name Two Chairs, Woori Bank’s private banking group, which caters to high-net-worth individuals, currently has six centers in affluent areas of Seoul, including Gangnam and Cheongdam. The bank recently opened its first center outside of Seoul in Busan and has plans for nationwide expansion.
To enhance the expertise of its private bankers, Woori Bank is providing exclusive training under its career development program. The bank also intends to tighten regulations on asset management and sales, introducing a “one-strike-out” penalty system for misselling and unethical sales practices, a first among local banks.
“We will demonstrate zero tolerance for misselling and unethical sales practices,” said Song Hyun-ju, head of Woori Bank’s asset management group. “Under this principle, we will implement a one-strike-out system that results in the immediate dismissal of private banker qualifications upon the discovery of such behaviors.”
The bank is also implementing a more thorough self-inspection process for customers before purchasing high-risk products. Customers will receive detailed risk precautions through a video presentation within one day of contract signing, with contract activation occurring three days after signing.
Woori Bank’s announcement comes amid ongoing concerns in the local finance sector regarding the alleged misselling of equity-linked securities connected to Hong Kong’s Hang Seng China Enterprises Index. South Korea has already confirmed nearly 1 trillion won ($750 million) in losses from these products, with the figure expected to rise.
Following past incidents involving the misselling of high-risk derivative products, Woori Bank stands out as the sole bank still offering HSCEI-linked ELS products, with others suspending sales as authorities investigate potential misselling.
While acknowledging an expected reduction in ELS product sales across banks, Song emphasized Woori Bank’s commitment to customer-focused sales strategies.
“We aim to prioritize sales based on the customer’s portfolio rather than specific investment products. This approach entails recommending a variety of products, including ETFs, funds, and bonds,” she explained.
In January, Woori Financial Group Chairman and CEO Lim Jong-Yong underscored the bank subsidiary’s role in restoring public trust in the overall sector and laying the foundation for its transition into an asset management bank.
(Source: The Investor Korea | Korea Herald)
