Aug. 18 (Asia Today) — Concern over South Korea’s plans to relocate government and public institutions outside Seoul is spreading across the country’s financial industry amid speculation that financial regulators and other institutions could also be moved.
Industry officials say the Financial Services Commission and Financial Supervisory Service could be included in the government’s plan this month for relocating central government agencies and a second group of public institutions.
Anxiety has increased since Land, Infrastructure and Transport Minister Kim Yoon-duk said Friday that the government’s principle was to leave as few institutions in Seoul as possible.
Employees at the Financial Supervisory Service have begun circulating petitions opposing a relocation of the agency’s headquarters and are gathering signatures by department.
The agency’s labor union said Monday that the government should “immediately halt a uniform relocation plan that ignores consumers and the realities of financial markets.”
Speculation has spread beyond public agencies to organizations including the National Agricultural Cooperative Federation, the Korea Financial Investment Association and mutual-aid associations.
The National Agricultural Cooperative Federation is a private cooperative rather than a public institution directly owned by the government.
“If even a private cooperative can become subject to relocation according to government policy, other companies cannot feel secure either,” one employee of the federation said. “A precedent should not be established in which corporate locations and management decisions are determined by policy.”
Financial industry officials say the issue is particularly sensitive because finance depends heavily on geographic clustering.
Financial institutions, corporations, capital markets and specialized workers benefit from being located near one another, allowing information exchange and rapid decision-making, industry officials say.
The Korean Financial Industry Union cited Seoul’s eighth-place ranking among 137 cities in the first-half 2026 Global Financial Centres Index as evidence of the benefits of clustering.
Concerns have also focused on the potential loss of skilled employees.
The union says efforts to relocate the state-run Korea Development Bank to Busan previously led to departures of key workers and organizational disruption.
Similar concerns have been raised about mutual-aid associations, which require close communication with asset managers, investment banks and securities companies.
Critics say relocation could make it more difficult to recruit specialized employees and maintain investment networks.
“Political gains may be obtained immediately, but it is unclear who will take responsibility when the side effects emerge 10 years from now,” one financial industry employee said.
— Reported by Asia Today; translated by UPI
Original Korean report: https://www.asiatoday.co.kr/kn/view.php?key=20260818010005842
