The Chaebeol’s Youngest Son Chapter 207

[207]Secure the location 4

On the morning of March 14, 2003, the Director of Policy 1 of the Financial Supervisory Commission came out of the KDB Capital building in Yeouido with a face as deep as the cloudy weather.

While investigating SK Global’s accounting fraud case, he discovered a problem that could shake the entire financial market.

He examined the fund containing SK Group’s bonds as if looking through a microscope, and found it strange that the size of the redemption request was wide compared to the size of the fund.

And it was discovered that the cause was the card stick.

Card bonds are short-term funds borrowed by credit card companies to pay the card bills used by customers. The credit card itself is a link made up of debt.

Already from the second half of 2002, the Financial Supervisory Commission was looking at it with uneasy eyes due to excessive competition and a rapid increase in credit defaulters.

However, since there were many bonds based on assets, it was judged that no major problems would arise if there were no special variables in extending the maturity of the bonds.

However, as the North Korean nuclear issue erupted, overseas short-term borrowing was halted, and financial market instability faced an uncontrollable crisis due to the accounting fraud at SK Global.

The size of the credit card debt was known to be about 50 trillion won, but as a result of the Financial Supervisory Commission’s investigation, it was no longer possible to remain silent when it exceeded 90 trillion won.

The financial authorities held a financial policy consultation meeting chaired by the Vice Minister of Finance and Economy at the Bank Hall in Myeong-dong, Seoul.

The urgent meeting lasted through the night, and on March 17, comprehensive measures for credit card companies were announced.

The measure on this day was to support financing by partially easing credit card regulations on the premise that credit card companies make intensive self-rescue efforts and take measures to improve their balance of payments.

The problem was the credit card company’s intense self-rescue efforts.

This phrase, “self-rescue,” includes pressure to reduce debt, even if it means pouring the company’s money into it.

However, chaebol families consider their own wealth more important than the company. It was obvious that the situation would worsen as no one was willing to waste the company’s money and government support funds to prevent the credit card company from going bankrupt.

“What about short-term bonds?”

“We are barely able to make up for it with the surplus funds from our affiliates, but we cannot survive for a few days.”

“As a temporary measure, we have reduced cash advance and card usage limits. However, cash advances will have to stop next month. “We are short on cash.”

Vice President Vibrator rubbed his forehead. I thought I was sweating, but I was mistaken.

Since I was in charge of heavy industry, I had the ability to sense changes in the market according to long-term economic trends. However, the situation of having to raise money every day at a financial company such as a credit card company was truly unbearable.

“We need to bring in more funds from affiliates. Or maybe there’s a big problem next month… .”

“no. “We can’t push our healthy subsidiaries into financial difficulties just by lending money to those who use credit cards!”

“But if cash advances are stopped, it can get out of control.”

“That’s right. “If the use of the Sunyang Card is stopped, it will have a negative impact not only on the card company’s stock price but also on the Sunyang Group as a whole.”

As the executives expressed their concerns, Vice Chairman Jin Jin-gi stopped rubbing his forehead.

“What are you doing now? Does today’s meeting agenda warn me of danger? “Aren’t we here to come up with a plan to overcome that danger?”

Short-term external debt and credit card debt may sound good, but they are debt anyway. You owe money, and the time has come to repay that debt. The only way to pay off debt is to pay it back.

Executives are trying to squeeze out money to repay the debt, but since there is no other way, there is nothing to say other than a warning.

There is no way to put out a fire in an emergency. Vice Chairman Jin Jin-gi just needs to take out the money he has hidden here and there. Even if we can’t do it, it will be hundreds of billions. But no one can say this.

Vice Chairman Jin Jin-gi said while looking disapprovingly at the executives who were silent.

“Dojun… . “No, what is Sunyang Life Insurance’s bond situation?”

This is the part that bothers him the most, so it has to be addressed.

“There are two months left to repay 300 billion won. This must be extended to maturity. Frankly, repayment is impossible.”

As expected, only the most extreme choice remained.

At this time, an executive’s voice was heard from the corner of the conference room.

“Vice Chairman. “Now I think we need to discuss the government’s self-rescue measures.”

“what?”

“Card company capital needs to be increased. “Unless stability is guaranteed, all measures are only temporary measures, and one day we will face the worst situation where card use is suspended.”

It’s not like other executives didn’t know about it, but it felt burdensome to say it in public.

Sunyang Card has no shares in affiliates. Increasing capital will not help the group’s dominance at all. Rather than increasing the capital of such a company, it is better to increase the capital of Sunyang Heavy Industries and further solidify Vice Chairman Jin Dong-ki’s control.

And lending Heavy Industries’ funds to credit card companies and putting out urgent fires is the answer and idea that Vice Chairman Jin Jin-gi wants.

However, the oblivious executive pressed the vice president for an answer.

“There is trust given by the name Sunyang Group. “There will be no major difficulties in expanding Sunyang Card’s capital.”

“Hey, more about that later…” .”

The executive sitting next to him tried to stop him with a wink, but it was already too late.

“okay? How much do you need? “Tell me what you think.”

“400 billion.”

“Is that money okay?”

“yes. Not only does it help put out urgent fires, but it also allows for stable financial management. A quadruple capital increase is quite possible… .”

“Let’s sell a 5,000 won face value bill for 20,000 won?”

“I think there is no problem because it is Sunyang Group. “This challenge can be resolved with 100 billion won in capital and 300 billion won in capital surplus, a total of 400 billion won.”

The executives did not hide their nervous expressions, but they felt relieved to see the opinions they wanted to express publicly on the conference room table.

“But Vice President, Sunyang Life Insurance’s 800 billion won in bonds must be extended. Even if more than 400 billion won is received, there is no way to stop Sunyang Life Insurance’s bonds.”

A person without sense will remain without sense until the end. If you read Vice Chairman Jin Jin-gi’s expression at all, he should not have said the last word.

“Well, since everything has been turned upside down, it looks like there’s nothing more to talk about… . Shall we end the meeting?”

Vice Chairman Jin Jin-gi left the conference room without even looking back. While everyone was still in the conference room, his voice pierced through the room.

“Card president, let me see.”

The CEO of Sunyang Card ran out of the conference room like a sprinter. When I barely got close to Vice President Vibrator, who was walking with great strides, I heard a cold voice.

“I don’t want to see that bastard starting tomorrow. And I will take care of the Sunyang Life Insurance bonds, and you, the president, will take care of the rest.”

I know who that bastard is without even having to say his name.

If the capital increases by 100 billion won, the stake will fall below 30%, and Sunyang Card’s dominance will disappear.

Chaebol owners abandon their companies rather than lose management rights.

Aren’t they a people who will never accept a landowner being reduced to nothing?

“yes. “Vice President.”

The CEO of Sunyang Card knew that his life was short. This may be the first time Sunyang Group goes bankrupt.

I bit my lip without knowing that I might be forced to resign from office in disgrace.

* * *

“Now everyone knows how ridiculous the advertisements such as ‘Everyone, let’s all become rich’ and ‘Your father said, enjoy life’ were, right?”

“Even if you know, you forget. “If we remembered everything, would these fraudsters still be in Korea?”

Oh Se-hyun showed a cynical smile.

“Now, tell me honestly. “Did you intuit this situation?”

It’s not something I felt, it’s something I saw with my own eyes. But the answer was different.

“It is a business in which debt continues to increase. “It wasn’t a situation like this, but I just thought that leading the company would be a burden.”

“Anyway, thanks to that, the bomb in my arms is gone. “It’s heavenly luck.”

“I plan to bring it back once the bomb is gone.”

“Will it be okay?”

“Card companies are no different from banks that lend money first and collect interest. “If you are careful about card issuance and limits, isn’t this a business you can easily swim on?”

Banks conduct thorough research on customers seeking loans and secure collateral before lending money.

There is no need for credit card companies to act like banks. This is because most loans have a one-month period and are small amounts. If the customer’s credit rating and income are carefully considered when first issuing a card, the risk of loss drops dramatically.

Why would you refuse to do business like this?

“It won’t be easy to get the cruiser card back, right?”

“There is no need to rush, but you should buy stocks in line with falling stock prices. And am I not a large creditor? “There are many ways.”

It’s easy to get just the credit card company back. What is difficult is that it kills two birds with one stone.

Vice Chairman Jin Jin-ki must express his regrets to his older brother, Vice Chairman Jin Young-ki.

To do that, I have to do something bad… It’s not difficult.

And that day came right away. This meant that the spark that fell on the credit card company was hot.

“Uncle. That’s troublesome. “My nose has grown three years old.”

“what?”

Vice President Vibrator opened his eyes and started glaring at me.

“My money flow was blocked due to the credit card crisis. Life, fire… It’s all a cry. It’s so serious that I’m currently looking into short-term borrowing. “How dare you borrow money from your father’s hospital?”

Cash loans, which were only 48 trillion won in 1999, soared to 268 trillion won as of the end of last year. As soon as credit card companies lowered their credit limits, 3 million credit defaulters poured in.

The Korean economy has already suffered from arteriosclerosis. There are not many companies left that can loudly say that there are no problems.

“The insurance premiums that used to come in every month have been cut in half. “If my uncle doesn’t settle the bond, we’ll be in big trouble.”

He trembled like never before and threw down a thick document.

“Take a look. Since all financial plans collapsed, all affiliates were in trouble. As you know, aren’t we all about making money? “Your uncle is in the heavy industry, so he must have better finances than us, right?”

“Don’t say anything. They are even stealing money from other affiliates and putting it on their credit cards. “If it continues like this, it will get worse.”

My uncle’s death is not normal either. No, isn’t this a terrible death?

“Anyway, let’s wait a little longer. The government might provide financial support… .”

“No, there is no government support. This happened as soon as the new government took office. That’s the price you pay for swiping cards and having fun. “I don’t have the guts to push ahead and ignore public opinion criticizing moral hazard.”

Oh my, how smart is this?

If you postpone the bond maturity until the last minute, you could be in real trouble, but you are showing caution in preparing in advance.

“Then are you going to stay like this? If my uncle doesn’t settle our debt, I won’t be able to survive. In the meantime, even if you didn’t pay the interest on the bonds properly, I just ignored it. “This is the limit.”

Vice Chairman Jin Jin-gi did not hide his embarrassed expression. He said quietly while looking at that expression.

“How about borrowing some money from outside?”

“Dojun. Do you think I would feel sorry for you, my nephew, if I had somewhere to borrow money? “Banks are also reeling because of the credit card.”

“I said that no matter how difficult it is, I will go to the third generation of rich people. “Isn’t there somewhere that can easily lend you a few hundred billion won?”

Suddenly, Vice President Vibrator’s eyes sparkled.

“where? Is there a place with that kind of funding? “You’re not talking about Myeongdong loan sharks, are you?”

“If you go to Myeongdong, you’ve gone as far as you need to go. Not there… . “Isn’t your uncle here?”

I lifted my finger and nudged it upwards.

“big? older brother!?”

Vice Chairman Jin Jin-gi immediately furrowed his brow.

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