Contrary to the initial tension, the two bank presidents left with smiles on their faces.
As they exited, Go Young-il, the president of Daheung Securities, turned to Seok-won, who remained seated comfortably, and said,
"If those two are on board, the merger should go much more smoothly."
Seok-won lifted his teacup and replied,
"Even if they're not actively helping, they won't get in the way. Not if they want that bonus."
"Well, hard to say no to 3 billion won."
After a moment of hesitation, Go Young-il cautiously added,
"I understand you're trying to carry out the merger without any friction, but… isn't the compensation a bit too generous?"
"It may seem that way."
"3 billion is more than enough to buy ten apartments in Gangnam. Honestly, you could've given them half that."
Leaning back in his seat, Seok-won explained in a relaxed tone,
"As top-five commercial banks, Hansung and Ilhan's executives are fiercely proud of their institutions. That pride won't disappear just because they've merged."
"True."
Go Young-il nodded in agreement.
"During the merger, both sides will likely be fighting tooth and nail to gain the upper hand. Even after they're combined, that rivalry could turn into a long-term internal power struggle."
It was an easily foreseeable issue, and Go Young-il clicked his tongue in frustration.
"If one side had the clear upper hand, maybe things would settle faster, but both are large, proud banks. It'll be like mixing oil and water."
"And if the two presidents sit on the sidelines with their arms crossed, being uncooperative, the merger will only become more difficult."
"That's why you're giving them golden parachutes."
When Go Young-il responded with understanding, Seok-won gave a faint smile.
"Their terms weren't even close to ending. Being forced out like this—it's only natural they'd be resentful."
"Well, I wouldn't be too happy in their shoes either."
Seok-won shrugged and took another sip of his green tea before setting the cup down again.
"There's a saying—'Give even the brat you hate an extra rice cake.' If you hand them overly generous bonuses, they'll be more focused on securing their golden retirement than on sabotaging the merger."
Then, interlocking his fingers and resting them on his knee, he added,
"If the two presidents are actively involved, we can reduce discord during the merger and make it much easier to unify the personnel from both banks. In that case, I'd say the 3 billion we gave them is money well spent."
After silently processing the reasoning, Go Young-il eventually nodded with an expression of agreement.
"When you put it that way, I see your point."
Watching him, Seok-won smiled and threw out a light joke.
"Feeling a bit jealous of those two walking away with all that bonus money?"
"Oh, not at all."
Flustered, Go Young-il quickly waved his hand, trying to dismiss the idea.
Seeing his awkward reaction, Seok-won chuckled softly and said,
"No need to worry. There's an even better gift waiting."
"Huh?"
Go Young-il looked puzzled.
Seok-won glanced briefly at Director Cha Sang-woo, sitting nearby, then spoke seriously.
"I'm giving you two weeks. Use that time to get your affairs in order and finish handing over your duties to Director Cha."
"...?"
Taken aback by the sudden announcement, neither Go Young-il nor Director Cha seemed to fully understand, staring blankly.
"What exactly do you mean by that?"
Go Young-il asked, stumbling over his words.
Calmly, Seok-won answered,
"I want you, President Go, to take charge of the new bank."
"M-me? Me?"
Completely caught off guard, Go Young-il repeated the question, bewildered.
"That's right."
Looking him directly in the eye, Seok-won continued steadily.
"To merge not just on paper but to fully integrate the internal organization and staff, we need a leader with exceptional management skills and strong leadership. I believe you're the right person for the job."
Hearing such high praise, Go Young-il felt a surge of pride inwardly.
Moreover, this newly formed merged bank would be the nation's first mega bank, with assets exceeding 100 trillion won. Being appointed as its inaugural president was an enormous promotion.
"So, what do you say? Will you take the position?"
"Of course. Though I may have shortcomings, if you entrust me with this, I will do my utmost to meet your expectations!"
Go Young-il answered with an excited look, holding his head high.
"It's a relief to know you'll be leading the bank."
Seok-won then shifted his gaze to Director Cha Sang-woo.
"I trust you'll manage the securities division well, too."
Suddenly promoted to president, Cha Sang-woo tried to calm his excitement as he replied,
"I won't let you down."
Pleased by their responses, Seok-won smiled contentedly.
"It will take time to fully resolve the discord and growing pains that arise during the merger and to stabilize the bank on a solid trajectory. I'll guarantee you a four-year term—so show me what you can do."
Typically, a commercial bank president's term lasts two years, with a possible one-year extension making it three years in total.
Guaranteeing at least four years, including reappointment, was Seok-won's way of clearly showing strong support and confidence.
Moved by such trust, Go Young-il jumped to his feet and bowed deeply to Seok-won.
"Thank you very much!"
***
November 18, 1997
— Gwanghwamun Government Complex, Building 1
With just one month left until the presidential election, the Ministry of Finance was steeped in tension.
In a spacious office, Deputy Minister for Economic Affairs Choi Jin-woo sat in the center of a sofa, surrounded on both sides by Ministry of Finance officials wearing serious expressions.
The room was thick with smoke from chain-smoking, but Deputy Minister Choi paid no mind as he pulled out a fresh cigarette, lit it, and took a deep drag of the white smoke. Exhaling slowly, his face was taut with nerves as he spoke.
"They say the 10-year bond spread issued by the Korea Development Bank has skyrocketed to 10%."
Financial Policy Director Jung Ji-hoon, catching the gaze, answered with a troubled expression.
"Yes. After the second credit rating downgrade announcement, the soaring interest rates haven't dropped—they've stayed high."
"Damn it. Even though we're receiving IMF bailout funds, South Korea's economic soundness is still among the best in Asia. This is really unfair!"
Choi Jin-woo slammed his palm down on the sofa's armrest, his frustration spilling out.
"Exactly."
"Frankly, isn't it too harsh to downgrade us twice in a row like this?"
The Ministry officials, already struggling to navigate the crisis, couldn't hide their anger and despair at the international credit rating agencies, who seemed to be adding fuel to the fire by lowering the credit ratings again.
In the midst of this, Vice Minister Shin Seung-ki spoke in a weary voice.
"We have strongly protested the downgrade to Moody's and S&P, but they only gave us the usual line that it was a reasonable decision based on various factors."
"Hmph! Reasonable? They're just in cahoots with the hedge funds attacking us."
Choi Jin-woo, his face reddened with anger, flicked his cigarette between his fingers and asked,
"Is the won still under attack in the foreign exchange market?"
Jung Ji-hoon replied with a worried expression.
"Yes. Since the IMF bailout, the speculative forces that had left the market have resumed their attacks following the downgrade, selling over 1.5 billion dollars worth of won already."
"Ugh…"
Choi Jin-woo involuntarily groaned and asked again,
"How much foreign reserves do we have left?"
Jung Ji-hoon hesitated before finally answering in a low voice.
"Only 11.05 billion dollars."
"That's all we have left?"
Choi Jin-woo immediately frowned and pressed further.
Jung Ji-hoon bowed his head apologetically.
"As I mentioned, a significant portion of reserves has been used to fend off currency speculation. On top of that, following the downgrade, Japanese banks have been aggressively recalling loans, depleting reserves further."
Choi Jin-woo grimaced deeply at this news.
"It feels like we're being attacked from all sides."
More than half of Korea's external debt had been borrowed from Japan.
Despite several appeals to the Japanese government to prevent their financial institutions from recalling loans, those institutions were already struggling with their own bad debt problems, so the pleas had no effect.
Grimly crushing his still-lit cigarette in the ashtray on the table, Choi Jin-woo said seriously,
"At this rate, issuing the planned 10 billion dollar foreign currency bonds next month will probably be impossible."
Vice Minister Shin shook his head.
"Everyone's dumping Korean bonds now, so the issuance is likely to fail. And if it's pushed through recklessly, it could trigger the failure of not only the Development Bank's bonds but also the Treasury bonds, which would have a far greater impact."
"Indeed," Choi Jin-woo agreed.
Deputy Minister Choi Jin-woo swallowed a heavy sigh and nodded gravely.
At that moment, Director Jung Ji-hoon, glancing cautiously around, spoke up with a tentative expression.
"If foreign currency continues to drain like this, our foreign exchange reserves will drop below triple digits before tomorrow."
Choi Jin-woo's face stiffened as he paused to think, then said,
"How about stopping the defense of the exchange rate again?"
"No, that's impossible! The exchange rate is already high—if we stop now, it could skyrocket uncontrollably."
Vice Minister Shin Seung-ki urgently stopped him.
Though Choi's suggestion was made out of frustration, he was well aware that giving up the currency defense now would cause devastating damage.
Feeling completely cornered, Choi Jin-woo let out a deep sigh.
"We're caught between a rock and a hard place—there's no way out."
"The only way to fix this situation is to expedite the disbursement of the second bailout funds from the IMF, as well as from the IBRD and ADB," said Vice Minister Shin.
Choi furrowed his brows.
"Who doesn't know that? But you also know that IMF Managing Director Townsend is blocking the second bailout because none of the presidential candidates have firmly promised to abide by the existing agreement without calling for renegotiation."
"That's…"
Vice Minister Shin fell silent with a somber expression.
Before the negotiations, the candidates had signed a memorandum, but when they started pushing for IMF renegotiation, Townsend dismissed those claims before the press, saying such a thing would never happen.
However, behind the scenes, unlike the public's dismissal of the issue as a mere election-time controversy, the IMF had halted the second bailout payment and was exerting heavy pressure on the Korean government.
The Ministry of Finance officials were already under fire, blamed for the IMF bailout, accused of betrayal, and even under audit investigations.
Now, political irresponsibility was only worsening the crisis, leaving Choi Jin-woo and his team with nothing but heavy sighs.
After a long moment of deep thought, arms crossed, Choi bit his lower lip tightly.
"It looks like there's no other way. I'll have to go back to the presidential candidates and persuade them, no matter what."
"We've already met with them, but there was no progress," said Vice Minister Shin, sounding exhausted.
"No matter how blinded by the election they are, they'll come to their senses once they realize the country is on the brink of bankruptcy. No one wants to take over a bankrupt nation after winning the election."
Choi Jin-woo steeled his resolve with a determined expression.
Right now, to avoid national bankruptcy, they had to grasp at any straw, no matter how thin.
He could only hope the presidential candidates would come to realize this truth as well.