[비즈한국] The appellate court hearing for a lawsuit filed by Sangsangin038540 Group against a financial regulator's order to sell its savings bank stake is set to begin. Sangsangin Group has been engaged in a legal battle since 2019, triggered by the judicial risks surrounding its CEO, Yoo Joon-won. After Yoo lost his eligibility as a major shareholder, the Financial Services Commission (FSC) issued an order in October 2023 for Sangsangin to sell at least 90% of its stake in its subsidiary savings banks. While two years have passed without a buyer being secured, the resumption of the lawsuit is expected to accelerate the timeline for the sale.
The first date for the appellate trial—in which Sangsangin is challenging the FSC’s order to satisfy major shareholder eligibility requirements and the subsequent stock disposal order—has been scheduled. The hearing is set for November 5, marking the first court proceeding 10 months after the appeal was filed in January. According to case records, it has been confirmed that the defendant, the FSC, submitted a request to designate a court date in late August.
This lawsuit was initiated by Sangsangin to cancel the FSC’s August–October 2023 order to meet major shareholder eligibility requirements and the order to dispose of its savings bank shares (Sangsangin Savings Bank and Sangsangin Plus Savings Bank). This followed the Supreme Court’s final ruling in May 2023, which upheld a three-month suspension for CEO Yoo Joon-won, causing him to lose his status as a qualified major shareholder under the Mutual Savings Bank Act.
CEO Yoo is the largest shareholder, holding a 22.67% stake in Sangsangin, which in turn owns 100% of the two savings banks. After the Supreme Court ruling, the FSC issued an order to satisfy eligibility requirements, but when Sangsangin failed to comply, the regulator ordered the disposal of more than 90% of the savings bank shares.
Sangsangin responded with an administrative lawsuit but lost in the first trial in December 2024. In January 2025, along with its appeal, the company requested a suspension of the FSC’s execution, and on February 20, the Seoul High Court granted the suspension of the stock disposal order. Consequently, the disposal order is stayed until 30 days after the second-instance court delivers its verdict.
The legal battle between Sangsangin and the financial authorities regarding CEO Yoo Joon-won’s judicial risks has now reached its sixth year. It was in December 2019 that the authorities imposed major disciplinary measures, including a three-month suspension, on Yoo due to illegal loan allegations. A suspension order typically prohibits re-employment in the financial sector for four years.
Sangsangin conducted administrative litigation from 2019 to 2023 to overturn the suspension of CEO Yoo, but lost through all three levels of court. When the resulting issues with major shareholder eligibility left the company facing a forced sale of its savings banks, it filed further administrative lawsuits to delay the enforcement of the order.
The illegal loan incident involves former and current executives of Sangsangin’s savings banks and CEO Yoo. From April 2015 to December 2018, the parties provided illegal loans to KOSDAQ-listed companies. While these companies publicly disclosed that they had attracted investment via convertible bonds (CBs), in reality, they were receiving high-interest collateralized loans from the savings banks.
Following this, CEO Yoo, the related executives, and the savings banks were indicted by the prosecution in 2020 for violations of the Capital Markets Act. The court deemed the actions fraudulent, noting that the CB-issuing companies hid the fact that they were taking out loans with collateral, thereby deceiving investors, and that investors suffered losses when stock prices subsequently fell.
In February, CEO Yoo was sentenced to four years in prison and a fine of approximately 18.6 billion won in his criminal trial. The court also recognized that he gained illegal profits from stock price fluctuations during the loan process. However, he was acquitted of charges related to manipulating Sangsangin's own stock price and charges of breach of trust related to the loans. Sangsangin Savings Bank and Sangsangin Plus Savings Bank were also fined 6.4 billion won and 11.9 billion won, respectively. CEO Yoo and the others have appealed, and the second trial is currently underway.
Meanwhile, the resumption of the trial to cancel the stock disposal order has accelerated the clock on Sangsangin’s savings bank sales. Under the Capital Markets Act, failure to sell the shares within the prescribed period could result in daily enforcement fines amounting to tens of millions of won.
Attention is also on whether the management improvement recommendations issued by financial authorities to Sangsangin Savings Bank and Sangsangin Plus Savings Bank in March and June this year will impact the sales. Regulators issue these measures when a savings bank's financial health deteriorates; these recommendations represent the lowest level (Level 1) of such measures.
Sangsangin maintains that its financial stability concerns have been eased as both savings banks improved their earnings this year. Sangsangin Savings Bank reported a net profit of 15.8 billion won in the first half of 2025, successfully turning a profit compared to the same period last year (-55 billion won). While Sangsangin Plus Savings Bank posted a net loss of 8.7 billion won in the first half of 2025, it reduced its deficit compared to the same period last year (-33.1 billion won).
Sangsangin continues to pursue the sale of both savings banks. Previously, OK Financial Group attempted to acquire Sangsangin Savings Bank, but negotiations fell through in July due to differences in positions. A Sangsangin representative stated, "We are currently discussing sale terms for Sangsangin Savings Bank with interested parties, but it appears difficult to complete the sale of Sangsangin Plus Savings Bank within this year."