U.S. banking regulations unfit for S. Korea: regulator

SEOUL, Jan. 3 (Yonhap) -- A U.S. measure to tighten banking regulation would be ill-suited if applied to South Korea as the local financial market needs more growth, the chairman of the nation's financial watchdog said Wednesday.

"Whether to apply Volcker's rule to us is another issue, although the new
American regulatory initiative lent many lessons," Chin Cong-soo, chairman of the
Financial Services Commission, said in a local forum.
President Barack Obama recently unveiled the proposed rule to curtail risky
activities and growth by big banks, in a measure called Volcker's rule, which is
named after former Federal Reserve Chairman Paul Volcker, an economic advisor to
Obama.
"In South Korea, the separation between commercial and investment banks is clear
and regulations over banks are strong," Chin said, referring to a U.S. attempt to
drive a division between the two.
Chin said South Korea should continue to nurture its financial industry to become
a key growth engine, indicating that the rule could stunt growth.
"Unlike established markets where excess growth causes a problem, our financial
market has not developed to the same extent," Chin said, adding "South Korea will
thoroughly improve structural weakness exposed by the latest crisis".
pbr@yna.co.kr
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