Financial regulators mount all-out fight to stay in Seoul amid relocation push

The Financial Services Commission and the Financial Supervisory Service are mounting an all-out campaign to remain in Seoul. With the government set to finalize the second round of central agency relocations in the fourth quarter, the two regulators plan to press the case for staying in the capital by highlighting risks to Seoul's financial-hub functions, operational efficiency, and policy and supervisory capacity from the loss of specialized staff. The Korea Financial Industry Union has also joined the fight, making the blocking of financial institution relocations a central demand in its general strike.

The FSS labor union plans to deliver to the government Friday afternoon a petition signed by 1,679 FSS employees expressing concern over the proposed relocation.

Within the FSS, there is deep anxiety that a move out of Seoul would trigger an exodus of specialized staff and weaken supervisory capacity. Many employees are said to have watched the government's briefing on its "Plan for Relocating Administrative and Public Institutions and Reforming Public Institution Functions" live on Thursday. "I don't understand why the relocation needs to be pushed through so forcefully," one FSS employee said. "Many staff will quit immediately — and who will bear responsibility for the resulting breakdown in financial supervision?"

It has not been confirmed, however, that the FSC and FSS will remain in Seoul. The government has said the FSC has not been excluded from the list of agencies subject to relocation, and it plans to finalize the list of Greater Seoul public institutions to be moved — including the FSS — within the fourth quarter of this year.

Inside the FSC, fatigue and frustration are mounting as the relocation decision drags on toward the fourth quarter. "So we just have to wait until the fourth quarter — nothing has changed," one FSC employee said. "It's still an unsettling situation." Another said: "I have no idea why this has been dragging on for months. My jeonse loan matures this year, and I need a decision as soon as possible so I can figure out what to do next."

The backlash is spreading to organized labor in the financial sector. The Korea Financial Industry Union is keeping open the possibility of a joint response and solidarity with the FSC, FSS and other financial regulators against the relocation. The union, which has run a task force to block the relocation since the start of the year, also made stopping the relocation of financial institutions a central demand at its general strike held Friday morning.

At a press conference Thursday, the union declared that "relocation of financial institutions without sufficient review and consultation with those directly affected is unacceptable." It argued that scattering financial policy and supervisory bodies across different regions from the firms they oversee would force companies to travel to reach regulators, and compel supervisory agencies to shuttle back and forth to Seoul and other cities for inspections — driving up inefficiency and costs.

The union also called on the government to assess the outcomes and living conditions from the first round of public institution relocations before proceeding with a second wave. It noted that inadequate infrastructure — including healthcare and education — has left many relocated employees living alone at their new postings while their families remain in the Greater Seoul area, or commuting back to the capital every weekend. The actual settlement effects of the existing relocation policy, it argued, must be examined before any further moves are made.

Meanwhile, the government has said it intends to strengthen Seoul and the broader metropolitan area's economic, cultural and international exchange functions while minimizing the number of public institutions allowed to remain there. It plans to revisit the criteria used to grant exemptions during the first relocation round, weigh each agency's functions and operational linkages, finalize the list of institutions to be moved within the fourth quarter of this year, and begin relocations sequentially from 2027.