[Financial District Tidbits]Woori Bank’s ‘Manager Kim’ Story

(Seoul=Yonhap Infomax) As Woori Bank prepares for its regular personnel reshuffle scheduled for early next month, employees born in 1971 are on edge.

Currently, Woori Bank staff born in 1971 are typically classified as department heads. These positions are divided into M1 to M3 grades based on career experience and performance, with most serving as department managers in operational divisions or as branch and center managers. They are considered candidates for executive (general manager) promotion at year-end.

This period marks the peak of their banking careers, with over 25 years of service and significant achievements. However, these employees have recently entered a state of heightened anxiety.

The reason lies in Woori Bank’s unique “rear assignment” (후선배치) culture.

Unlike other major commercial banks, Woori Bank has a practice of reassigning employees starting at age 55. While competitors such as Shinhan Financial Group implement job changes at age 56, coinciding with the start of the wage peak system, Woori Bank initiates this process a year earlier. Internally, this is referred to as “rear assignment.”

If Woori Bank’s 1971-born employees are not included in the executive appointments early next month, they will step down from their current posts next year. They will then spend a year in rear assignment roles before entering the wage peak system the following year.

Upon entering the wage peak system, employees must choose between remaining with the bank or opting for retirement. Many view the total salary received over the five-year wage peak period and the lump-sum severance from voluntary retirement as essentially equivalent, leading most to retire early and plan a second career.

For these employees, the rear assignment decision effectively signals that “there is one year left in their banking career,” making the process particularly sensitive.

There are two main ways to avoid rear assignment, but both are challenging. The best option is to be promoted to executive (general manager). Alternatively, the HR team may offer an extension in the current operational role. If neither occurs, rear assignment is inevitable, shifting employees to internal control or administrative tasks.

The “operational extension” offer is typically a consolation for those who narrowly miss executive promotion, allowing them to continue in their current role for another year. In rare cases, a further one-year extension is granted for outstanding performance, but most are reassigned.

The rationale for rear assignment is straightforward: there are more employees than available positions. The intensity of competition for year-end rear assignments varies depending on the size of the hiring cohort. Years with larger intakes see fiercer competition, while smaller cohorts face less pressure. Generally, regional branches outside Seoul and the capital area are less competitive due to more available positions.

Unfortunately, the outlook for this year-end is challenging.

Those born in 1971, who would have entered university around 1990 if they took a gap year, represent a particularly large cohort in the banking sector. For men, factoring in four years of university and about three years of military service, this generation entered the workforce around the 1998 IMF crisis, a period when banks were aggressively recruiting talent.

“Given the large intake during that period, sensitivity around promotions and rear assignments is higher than usual,” said a financial industry official. “Ongoing discussions about extending the retirement age and the popularity of the drama ‘Manager Kim’s Story in Seoul’ are also influencing sentiment.”

However, within Woori Bank, the rear assignment culture is not universally viewed as harsh.

Since employees continue to receive their existing salary during the rear assignment period, there is no additional financial opportunity cost.

“Some employees use the rear assignment period to wrap up their banking careers and plan for their next chapter,” a Woori Bank official said. “In fact, having an extra year to prepare compared to competitors is seen as a positive.” (Finance Department, Won Jung reporter)

jwon@yna.co.kr

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