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The chamber surveyed 150 CEOs nationwide about the future and competitiveness of the financial industry.
It addition to the middling rating of the industry overall, the executive rated all is individual sectors in the 60s. Banking was rated highest at 69.3 points, followed by insurance at 66, credit finance at 65.8 points, securities at 62.8 points and asset management at w 60.8 points.
“It is true that the local financial industry is relatively uncompetitive considering that the Korean economy is the world’s 15th largest,” said a spokesman for the chamber. “It seems that the small scale of the financial institutions and the simple profit structure centered only on the domestic market are the main causes.”
When asked about the biggest threat to the domestic financial industry, 37.5 percent of the CEOs cited a weakened revenue base in line with slow growth and low interest rates.
In addition, they also worried about implementation of a phased exit strategy for stimulus by the U.S. Federal Reserve (25.6 percent); the capital market crunch, especially bonds, (15.3 percent), global trends toward greater regulation (13.3 percent) and slower growth in China (8.3 percent).
“As the key factors of low growth and low interest intensify, concerns about the management of the domestic financial institutions, whose revenue structures rely on commissions, are growing,” said a research fellow at the Kcci.
“To enhance competitiveness, government deregulation and establishment of efficient infrastructure are necessary.”
Among the surveyed CEOs, government deregulation was cited by 46.4 percent as the most urgent task for improving competitiveness.
Other necessary measures named were developing quality professionals (19.9 percent), expanding infrastructure (15.2 percent), diversifying revenue structures (11.3 percent), such as expanding overseas, and enlarging the scale of financial institutions (7.2 percent).
The Kcci also suggested that the role of financial industry is important to realizing the new creative economy paradigm, promoted by the Park Geun-hye administration.
“The CEOs believe the primary role of financial institutions in supporting the creative economy is financial support of start-ups through funding,” said a Kcci spokesman.
Thus, the Kcci urged the government to establish a financial system in which creative ideas and techniques can be appreciated, so institutions would continue support start-ups.
“The financial industry is a core service industry that overcomes the limitations of economic growth centered on the manufacturing industry and creates high-value added businesses and jobs,” said Chun Su-bong, director of a Kcci research team.
“The government should proceed with its plan of advancing the financial system and financial institutions entering emerging markets, which will be included in the road map for mid- and long-term development, so that the finance industry will become the new growth engine of our economy.”
By Kim Jung-Yoon [kjy@joongang.co.kr]
