NongHyup's Treasury Bid Leans on Cooperative Branches, Even as Nationwide Fraud Losses Raise Questions

NH NongHyup Bank argues that the region's local cooperative branches belong in its count because rural and fishing-village residents reach financial services through them ^[9]. Add them to its own 93 outlets and it has 673, about 6.5 times The Kwangju Bank's network ^[7]. The fraud data comes from the same kind of institution. It covers accounts at agricultural and livestock cooperatives, according to figures the National Agricultural Cooperative Federation submitted to Rep. Moon Geum-joo of the Democratic Party ^[3]. If the cooperatives count as NongHyup's network when access is scored, I think they count as NongHyup's network when customer losses are scored too.

The prize is a flow of money, and two banks share it. The 25 trillion won is the city's expected annual budget, central government transfers included ^[2]. The city will pick two treasury banks, one for the general account and one for special accounts, on a contract running from Jan. 1, 2027 to Dec. 31, 2030 ^[12]. Across those four years, about 100 trillion won would pass through the pair ^[8].

The 322 billion won in losses covers 12,339 cases ^[3], or about 26.1 million won per case ^[3]. At the reported refund rate ^[5], roughly 290 billion won never came back ^[4]. "NongHyup is the financial institution most accessible to rural communities and older adults across the country, so it must serve as the last safety net protecting people's assets," Moon said ^[7]. NongHyup said its fraud detection system stopped about 147.5 billion won of losses over five years ^[6]. That is about 46% of the losses counted over four and a half years ^[5]. The periods do not match, and on a matched period the share would be lower.

The trend is less steady than the 13-fold figure suggests. Losses in 2025 were about 13.8 times those of 2022 ^[1], but 2023 and 2024 together came to only 85.8 billion won ^[2], and the first half of 2026 produced 43.3 billion won ^[4]. Doubled, the half-year figure is 86.6 billion won, under half the 2025 total ^[6], though half-year numbers can be seasonal. The report also says the refund rate fell as losses grew, to roughly 11% recently ^[5]. On the rounded figures the direction runs the other way: 11% on the 223.2 billion won lost in 2025 and early 2026, against a 10% average overall, implies the earlier losses were refunded at under 8% ^[9].

The review committee ^[10] settles the fraud question when it settles the branch question, and it can go one of three ways. It can accept The Kwangju Bank's view that the cooperatives are separate legal entities ^[9]. That leaves NongHyup with the smaller network and no responsibility for the cooperatives' record. It can count the branches and score credit standing and financial structure stability ^[11] on the bank's own books, where losses carried mostly by customers barely show ^[4]. Or it can count the branches and read the cooperatives' customer losses into that category.

The third is the consistent position, in my view. The counter-case is that the category as named tests solvency. The reported figures also come without a Jeonnam-Gwangju breakdown or any comparable number for The Kwangju Bank's customers, and a committee could decline to score a record it cannot compare. If second-half losses hold to the first-half pace ^[6], NongHyup also gets to argue the problem is shrinking.