Officials of successive administrations and industry executives have long voiced the need to bring the nation’s financial firms up to the same level as companies like Samsung Electronics and Hyundai Motor.

So there has been a lot of hoopla, with government officials pledging support for globalization drives by local financial firms and measures to improve their competitiveness, and executives putting forward ambitious plans to upgrade their products and services.

But if recent developments are any indication, notably the boardroom feud at KB Financial Group, massive data leaks by credit card companies, illegal loan scandals and the bankruptcy of Tong Yang Group, the nation’s financial sector is degenerating into a backwater industry.

This gloomy reality was backed by the Global Competitiveness Report 2013-14 compiled by the World Economic Forum, in which Korea’s financial market development ranked in 81st place, compared with its overall ranking of 25th.

In other words, the poorly functioning financial market is holding back Korea’s overall competitiveness. Despite this, financial executives enjoy fat paychecks. According to a Yonhap report, the CEOs of major Korean financial groups are paid three times more than their Japanese counterparts though the Korean firms’ net profits and assets are only one-third as high.

Figures like this bring down public confidence in the nation’s financial industry. A recent survey of the Korea Institute of Finance verified the low level of public confidence in the sector.

The KIF set the baseline of its “Financial Confidence Index” at 100, with figures above this indicating that there are more positive than negative answers and vice versa for figures below this mark. The index for the overall confidence in the nation’s financial sector stood at 89.5.

What’s more disturbing, though anticipated, is that financial consumers have much less confidence in the regulatory authorities. The KIF index on the efficiency of government regulators stood at 61.3, the lowest mark in the nine-question survey.

The index rightly reflects the market players’ frustration with regulatory authorities’ botched handling of the Tong Yang case and the fiasco at KB, as well as its notorious bureaucratic red tape and sponsorship of revolving-door appointments.

In sum, financial firms that lack global competitiveness and inefficient, bureaucratic regulators team up to hinder the development of the all-important sector.

No industry requires a higher level of public confidence than the financial sector. Both the industry and government officials must strive to regain public confidence.