Watchdog sharply cuts penalties on 5 banks over mis-selling of HK-tied derivatives - The Korea Times

HK-tied ELS buyers protest in front of NH Nonghyup Bank in central Seoul, March 15, 2024. Newsis

Five banks were slapped with some 600 billion won ($393 million) in penalties by the financial watchdog Thursday over their mis-selling of equity-linked securities (ELS) products tracking Hong Kong's H Index.

The amount is a sharp cut from the initial 1.2 trillion-won fine on the five lenders — KB Kookmin Bank, Shinhan Bank, Hana Bank, NH Nonghyup and SC Korea — which had already suffered massive losses as they had compensated customers over the mishap, according to the Financial Supervisory Service (FSS).

Last month, the Financial Services Commission (FSC), Seoul's financial regulator, tossed the watchdog's proposed penalties back, saying that some legal issues should be further reviewed.

The penalties will be finalized by the FSC later.