外國銀行 國內支店의 營業活動에 대한 特惠 및 規制

A Review of the Government Regulations on the Business Activities of the Foreign Banks in Korea

The purpose of this paper is not only to criticize the privileges and regulations by the government on foreign banks in Korea, but also to suggest the ways which domestic commercial banks can survive the competition with them. The privileges of foreign banks are as follows; (1) the permission of swap transaction and compensating deposit (2) the allowance of the preliminary call transaction (3) the exclusion from implementing credit limit to single borrower (4) the permission of the flexible operation of foreign exchange position (5) the exclusion from contribution premiums of KCGF (Korea Credit Guarantee Funds) and (6) the tax advantages. As regulations on foreign banks, there are the limitation on their operation funds, the prohibition from acquisition of land, the limitation on the expansion of their branches and so on. Foreign banks have mainly done the wholesale and commission based business and also lent their interoffice borrowings. Due to the privileges such as swap, they have enjoyed the high earnings. On the other hand, domestic commercial banks have had a low earnings by the increase in policy loans and problem loans forced by the government. They have made a great contribution to the Korean economy in a sense of the supply of foreign funds, the increase in employment and tax revenues. However, they bave given the difficulty in setting up and implementing the financial policy of the government. In this regard, the government, trying its best for domestic commercial banks to have an edge on them, should gradually decrease the privileges and regulations on them in the light of the internationalization of the financial institutions.