Financial Supervisory Service News

South Korea's Big Three shipbuilders  - Hyundai Heavy Industries (HHI), Samsung Heavy Industries (SHI) and Daewoo Shipbuilding & Marine Engineering (DSME) - have hit record low in workforce.According to a report in Business Korea, the total number of employees in South Korea's Big Three shipbuilders has plunged a whopping 27 percent compared to 2011.The “big three” shipbuilders had 36,757 employees on the payroll last year, down 27.04 percent from 50,377 in 2011.The figure decreased to 35,623 in the first half of this year as 1,134 more workers left the companies, the report said quoting sources in Financial Supervisory Service, South…

The former chairwoman of bankrupt Hanjin Shipping Choi Eun Young  is under investigation for alleged insider trading BBC reports qoting South Korea's Financial Supervisory Service. She has come under scrutiny after it was revealed she sold all her shares in the firm days before it filed for a debt restructuring programme in April. Ms Choi and her two daughters sold shares worth 3bn won ($2.7m, £2.1m) in April. She left the company in 2014. The sell-off saved Ms Choi and family around S$1.35 million as Hanjin continued to sink amidst the global downturn in trade, the WSJ, quoted authorities as saying. The sale prompted regulators to launch an investigation and hand the case over to a prosecutors' office.

South Korea’s biggest container shipping line Hanjin Shipping Co has decided to apply for court receivership after lenders halted all support, says a report in Bloomberg. A Reuters report also says that it would file for court receivership after losing the support of its banks, and the country's financial regulator said a rival operator will look to buy Hanjin's "good" assets. Banks withdrew support for the world's seventh-largest container carrier on Tuesday, saying a funding plan by its parent group was inadequate to tackle the firm's 5.6 trillion won ($5 billion) in debt. South Korea’s Financial Supervisory Service said in a statement Wednesday that Hyundai Merchant may consider taking over some of Hanjin Shipping’s assets, including vessels, network and staff.

South Korean banking group KB Financial Group Inc is acquiring a controlling stake in brokerage Hyundai Securities Co Ltd for 1.25 trillion won ($1.09 billion) in a high-priced bet on diversification. About two-thirds of KB Financial's 2015 net profit came from its banking unit, Kookmin Bank, and the acquisition of South Korea's sixth-largest securities brokerage by equity capital is aimed at bringing that ratio closer to a stated goal of increasing non-bank contribution to 40 percent.

Prosecutors investigating the fatal sinking of a South Korean ferry have raided the home of Yoo Byung-un, the head of a family that owns the Chonghaejin Marine Co. Ltd, the company that operated the ship. Kim Hoe-Jong, a prosecutor on the case, said Wednesday's raid was part of a probe into "overall corruption in management". Of the 476 passengers and crew on board the Sewol, 339 were children and teachers on a high school outing to the holiday island of Jeju. Only 174 people have been rescued and the remainder are presumed to have drowned. The confirmed death toll on Wednesday was 150. South Korean prosecutors and agencies tend to adopt a blanket approach in raids, rather than targeting specific lines of inquiry.

The company that owned the South Korean ferry which sank last week, killing possibly hundreds of people, sprang out of a shipping to cosmetics empire founded by a businessman who was jailed for fraud and then went bankrupt. The founder of the predecessor company, Yoo Byung-un, once likened his 1997 bankruptcy proceedings to a captain going down with his ship. An investment vehicle run by his two sons and its shipbuilding affiliate are now the majority owners of Chonghaejin Marine Co. Ltd, the operator of the ferry that capsized. There is no suggestion that last Wednesday's accident was in any way linked to the company's chequered history. But Yoo and his two sons have been barred from leaving South Korea as investigators seek to establish what led to the fatal sinking of the Sewol ferry.

The captain of a South Korean ferry that capsized two days ago rushed back to the bridge after it started listing severely and tried in vain to right the vessel, one of the helmsmen on the ship said on Friday. A junior officer was steering the Sewol ferry when it capsized on Wednesday, leaving 28 people officially declared dead and 268 missing, almost all of them high school students. Divers are fighting strong tides and murky waters to get to the sunken ship but hopes are fading of finding any of the missing alive. "I'm not sure where the captain was before the accident. However right after the accident, I saw him rushing back into the steering house ahead of me," said Oh Young-seok, one of the helmsmen on the ship who was off duty and resting at the time.

The vice-principal of a South Korean high school who accompanied hundreds of pupils on a ferry that capsized has committed suicide, police said on Friday, as hopes faded of finding any of the 268 missing alive. The Sewol, carrying 475 passengers and crew, capsized on Wednesday on a journey from the port of Incheon to the southern holiday island of Jeju. Kang Min-gyu, 52, had been missing since Thursday. He appeared to have hanged himself with his belt from a tree outside a gym in the port city of Jindo where relatives of the people missing on the ship, mostly children from the school, were gathered. Police said Kang did not leave a suicide note and that they started looking for him after he was reported missing by a fellow teacher. He was rescued from the ferry after it capsized.

According to a July 30 report from the JoongAng Daily, with the scheduled adoption of the International Financial Reporting Standards (IFRS) shipbuilders were expected to see higher debt ratios. However, the Financial Services Commission and Financial Supervisory Service said that the International Accounting Standards Board (ISAB), the London-based group that supervises the IFRS, had accepted in principle a request by Korean financial authorities to allow a fair value hedge accounting system in the case of the shipbuilders. A fair value hedge system would allow shipbuilders to declare an intermediate payment in their financial accounts for contracts they received. (Source: JoongAng Daily)

South Korea's Daewoo Heavy Industries Co apparently plans to split into three units on October 23, pending an approval from its board of directors. It's unknown at present how the spin off will effect the world's second largest shipbuilder. The company planned to divide its shipbuilding and machinery operations and form a third company to manage its debts. The machinery and shipbuilding units are expected to list separately around December 20, pending approval from the Financial Supervisory Service.

Reports indicate that South Korea's Daewoo Shipbuilding & Marine Engineering Co. (042660.SE) said Monday that it has canceled an order, received in October, for two vessels worth KRW409.1 billion. Daewoo Shipbuilding decided to terminate the contract as the buyer failed to make a payment by the due date, the South Korean shipbuilder said in a filing to the Financial Supervisory Service. In October, Daewoo Shipbuilding said that it received an order from Singapore's Frigstad Offshore Drilling Ltd. to build two semi-submersible drilling vessels for delivery by June 2009. Officials at the Singaporean company could not be immediately contacted for comment.