Top executives of Korea Development Bank and Export-Import Bank of Korea have agreed to return bonuses ahead of state recapitalization, the lenders said Saturday.

At KDB, a policy bank under fire for lax oversight of the companies it bailed out, four will give back the entire bonus cash they received based on last year’s performance. 

They include former CEO Hong Kyttack, who has earlier returned his 2015 salary.

Hong, in February this year, moved to the Asia Infrastructure Investment Bank to take up the office of chief risk officer but has recently taken a leave of absence from the Beijing-based institution as Korean prosecutors intensify an investigation into an alleged accounting fraud at Daewoo Shipbuilding & Marine Engineering, KDB’s subsidiary.

Over at Eximbank, five executives, including the current CEO Lee Duk-hoon, have agreed to return bonuses, the bank said.

Korea has decided to set up an 11 trillion won fund to recapitalize the two banks which are heavily exposed to troubled shipping and shipbuilding industries.

By Lee Sun-young (milaya@heraldcorp.com)