Daol Savings Bank is under investigation for allegedly providing improper financial support to its major shareholder, Daol Investment & Securities, during the Legoland crisis.
The Seoul Metropolitan Police Agency's Financial Crimes Investigation Unit conducted raids on the headquarters of both Daol Investment & Securities and Daol Savings Bank on the 17th. Police reportedly identified potential violations of the Mutual Savings Bank Act and moved to secure related documents.
According to the Seoul Economic Daily's investigation, Daol Savings Bank allegedly provided improper financial support to Daol Investment & Securities, which holds a 60.2% stake in the savings bank. When Daol Investment & Securities faced liquidity pressures following the 2022 Legoland crisis, Daol Savings Bank allegedly provided indirect support.
Specifically, there are allegations that Daol Savings Bank subscribed to wrap accounts and specified money trusts at iM Securities, and these funds subsequently flowed to Daol Investment & Securities. Police and the Financial Supervisory Service are reportedly examining potential violations of the Savings Bank Act, which prohibits providing money or financial benefits to major shareholders.
"Savings banks take deposits from customers for lending and asset management," said an industry source. "If they were improperly used to support a major shareholder, that would be a serious problem."
The Mutual Savings Bank Act Enforcement Decree stipulates that major shareholders must have no criminal penalties of 10 million won or more for violations of financial laws to maintain shareholder eligibility. Depending on the investigation results and FSS sanctions, the case could potentially escalate into a governance issue.
"This is an industry with such strict regulations that even discounted rent between affiliates can result in institutional warnings," said a savings bank industry source. "If the allegations prove true, the repercussions will be significant."
Market observers note that if improper support is confirmed, it could jeopardize the major shareholder's eligibility status.