A Seoul court on Monday found Hana Financial Group Chairman-nominee Ham Young-joo responsible for Hana Bank’s improper sales of derivatives-linked products that caused a fiasco in 2019 after investors saw huge losses.

Defying market expectations, the Seoul Administrative Court found the chairman-nominee and then-Hana Bank CEO guilty of failing to appropriately supervise the bank’s misselling of troubled products to its consumers.

The court nodded to the financial authorities’ claims that 183.7 billion won ($147.9 million) worth of derivatives offered by Hana Bank to its customers from May 2016 to 2019 were “missold.” It said that it is “difficult to see” that Ham, who was the chief of Hana Bank from September 2015 to March 2019, had “fully carried out his responsibility to protect customers, while they have seen massive losses due to the misselling.”

The watchdog Financial Supervisory Service said in 2019 that a total of 822.4 billion won worth of the troubled derivatives-linked products were sold in South Korea from 2016 to mostly retail investors. The FSS added the following year that Hana Bank and its industry rival Woori Bank were responsible for some 90 percent of the total products sold here, amounting to a combined 795 billion won. Hana and Woori each saw a loss of 73 billion won and 63.6 billion from the product, respectively.

The products were designed to track US, UK or German Treasury yields which had abruptly plummeted in 2019 amid signs of a global recession, hurting the derivatives tied to the overseas interest rates.

The court ruling came after the policymaking Financial Services Commission slapped a 16.7 billion won fine on the bank and banned it from selling more funds for six months in March 2020. On Ham, it imposed a “reprimand” warning -– the third-highest level of the FSC’s five-tier punishment system –- which bans the recipient from being hired to a new role in the financial sector for at least three years.

The latest court decision comes as a surprise for industry watchers, who expected Ham to be cleared of the charges. The Seoul Western District Court sided with the chairman-nominee on Friday, clearing him of any wrongdoing in allegations that he exercised his influence on a hiring request at Hana Bank in 2015. On top of that, a Seoul court sided with Woori Financial Group Chairman Sohn Tae-seung on similar derivatives misselling allegations.

Hana expressed regret over the court‘s ruling Monday, saying that the bank has tried its best to minimize the damage by providing compensation to investors as ordered by the authorities.

Despite the lingering legal woes, Ham is expected to become Hana Financial Group’s next chairman after confirmation at the shareholders meeting scheduled March 25. A Seoul court earlier accepted an injunction to delay the implementation of the FSC’s punishment imposed on Ham, buying the 66-year old time to push back additional legal disputes after the shareholders meeting. Ham was nominated by Hana‘s chairman recommendation committee as the next chief of one of the nation’s top banking groups. He would replace Kim Jung-tai, who was at the helm of the firm for the last decade.