Kim & Chang holds near monopoly on bank consultation: report
The nation’s top law firm, Kim & Chang, holds a near monopoly on the law consultation market for domestic commercial banks, according to a recent report. The law firm has allegedly brought in large numbers of former high-ranking government officials as advisers to help maintain its hold on the market. According to the report, submitted by the Financial Supervisory Service (FSS) to lawmaker Kim Yang-su of the main opposition Grand National Party’s National Policy Committee, Kim & Chang earned 18 billion won (US$19 million) out of a total 25 billion won (US$26 million) of law consultation fees paid by eight major commercial banks between 2004 and June 2006. That figure is nearly 73 percent of the total consultation fees paid by those banks. By number of cases, the law firm represented 39 percent, or 1,033, out of the eight banks’ 2,642 total consultation cases. Looking at all domestic banks, including government-run and commercial banks as well as provincial institutions, Kim & Chang’s consultation fees encompassed 66 percent of the total legal fees spent. Banks that have been bought with foreign capital, in particular, were more frequent clients of Kim & Chang. Standard Chartered First Bank hired Kim & Chang for 139 (74 percent) out of 187 of its cases during the betwen 2004 and June 2006, paying the firm 87 percent, or about W6.4 billion, of its total consultation fee of W7.3 billion to the law firm. Korea Foreign Exchange Bank paid 78 percent and Citibank Korea paid 74 percent of their total consultation fees to the law firm.The firm was thought to have a hold on the banking market due to its laundry list of powerful advisers. "Kim & Chang has brought in dozens of former high-ranking financial officials, such as former FCC official Kim Sun-dae, as its advisers. It seems that their influence has strengthened the firm’s monopoly," an aide to Rep. Kim said. Kim & Chang’s average fee per case is W17 million, compared to the W7 million average at other law firms.
