The head of Kakao Bank, Korea‘s second internet-only bank, expressed concerns on Nov. 3 that restrictions on ownership of a financial firm by a non-financial company could undermine innovation in the banking sector.
“The pace of innovation could slow down unless the restrictions are eased,” Yun Ho-young, one of the bank’s two co-CEOs, said in a news conference in Seoul marking the first 100th day anniversary of the lender starting operations.
Yun suggested that the banking regulations could stand in the way of innovation in the internet-only banks, especially in raising capital.
The lender launched in late July with paid-in capital of 300 billion won (US$268.97 million), increased its capital by 500 billion won in September in a move that could bolster its lending business.
Under the current laws, a non-financial firm is prohibited from holding more than a 4-percent stake in a bank to keep lenders from being used as private vaults for family-run business conglomerates.
By Alex Lee and newswires (firstname.lastname@example.org