16 savings banks fined for breaching rules: lawmaker

SEOUL, Sept. 20 (Yonhap) -- A total of 16 South Korean savings banks have been penalized over the last five years for breaching industry regulations, data showed Tuesday, amid ongoing inspections of the debt-saddled industry's irregularities.
Between 2007-2011, South Korea's financial watchdog imposed penalties worth 5.6 billion won (US$4.8 million) on 16 local savings banks, including six players whose operations were suspended this year, according to the data provided by Rep. Lee Jin-bok of the ruling Grand National Party.
The figure accounts for nearly half of the 33 cases in which the government fined finance industry players, including lenders and insurers, for breaking industry regulations during the cited period.
South Korea has suspended business operations of 16 local savings banks this year alone, citing their weak financial health and heavy debts.
Separate data provided by Rep. Lee Bum-rae of the Grand National Party showed that the financial watchdog reprimanded savings bank executives at least 20 times over the last three years for irregularities such as illegal loan extensions and embezzlement.
The data, which was compiled by the Financial Services Commission (FSC) for a state audit, comes after the financial regulator said it discovered illegal loans extended by suspended savings banks to their largest shareholders.
The FSC said it plans to ask prosecutors to investigate the reported cases.