Gov't regulator postpones Shinhan Bank sanction decision

SEOUL, Aug. 25 (Yonhap) -- South Korea's financial regulator said Thursday that its has put off making a decision on sanctioning Shinhan Bank, the country's No. 3 lender, citing the need for more time to review violations.
The Financial Supervisory Service (FSS) said it will reconvene its sanction review committee on Sept. 8 to make its decision on the bank's violation of the country's real name financial transaction act.
It was also accused of inadequately screening loan requests, an action that could lead to losses.
Shinhan was slapped with a disciplinary warning on Nov. 25, 2010, with the FSS saying it planned to give out another warning.
If the bank receives the second warning next month, various limits could be imposed on its operations for six months. The government could withhold financial investment authorization on the bank, which would hurt its business.
In addition, the FSS is expected to decide what action it will take against Shin Sang-hoon and Lee Baek-soon, both ex-heads of the bank, who had engaged in an internal feud that tarnished the lender's image.
If the financial regulator delivers severe warnings to the two former executives, they could be barred from finding work in the financial sector.
Besides the Shinhan Bank issue, the state regulator will review allegations levied against Chung Tae-young, head of Hyundai Capital, who has been cited regarding a hacking incident involving client information.
In Chung's case, insiders said the level of the reprimand will not be severe and he may receive an admonition.