South Korea’s Yoon calls on banks and telecoms to cut living costs | Business and economy

South Korean President Yoon Suk-yeol is calling on the private sector to ‘share the pain’ to ease the struggles of the most vulnerable.

South Korean President Yoon Suk-yeol has called on the private sector to help contain rising costs for the country’s most vulnerable people, with a focus on banks and communications services.

Yoon chaired a meeting of the country’s economy ministers on Wednesday to discuss how to tackle cost-of-living pressures.

“I think private sector players should voluntarily join the effort to share the pain by helping to keep prices stable,” Yoon said at the meeting, noting the role that banks and communications services could play.

Yoon’s office said the president ordered measures to boost competition in the banking and communications services sector during a closed-door portion of the meeting.

At the same time, the government said it would launch a task force this month to look into ways to improve business practices at the banks amid concerns raised in the media about their large profits and generous pension payouts.

The government said in a statement that the working group will develop measures to strengthen competition, improve compensation schemes, strengthen the ability to absorb losses and reduce dependence on interest income in the banking sector by the end of June.

The task force, made up of financial regulators, banks, academics, legal experts and consumer groups, will also seek to find ways to expand fixed-rate lending and increase banks’ contribution to society, it added.

South Korea has 20 local banks and 35 branches of foreign banks, but business has been dominated by a handful. Local media often criticized banks for making unfairly large profits by raising interest rates.

In recent weeks, local media have also reported that some banks have paid out hundreds of millions of won per head as compensation for early retirement.

The government’s statement did not include a new plan to introduce more competition among mobile phone services, a sector also dominated by a handful of service providers.

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