Gov't to split Woori Finance into smaller units for sale

By Kim Seung-yeon

SEOUL, June 26 (Yonhap) -- The government will split Woori Finance Holdings Co. into smaller units and put each of them up for sale from July, the financial regulator said Wednesday, as it unveiled its final road map for the privatization of the state-run banking firm after a few botched attempts over the past three years.

The Financial Services Commission (FSC), the country's top financial regulator in charge of the Woori sale, laid out details on the long-pending plan at a press briefing held in Seoul.

Under the plan, 14 affiliates of Woori Finance will be split into three different groups; regional banking, Woori Bank and brokerage units.

The FSC will put two smaller affiliates -- Kwangju Bank and Kyongnam Bank -- in the regional banking unit, and merge each of them with their respective holding companies to be set up in the near future for a swift sale.

Woori Bank, the flagship business of the banking group, will be merged with Woori Finance and be sold as a bank, not a holding company, to avoid legal barriers as local law imposes stricter rules on financial holding firms, the FSC said.

The state-run Korea Depository Insurance Corp. (KDIC), the controlling shareholder of Woori Finance, will take care of handing over 56.97 of its government stakes in the banking group to private hands. It is scheduled to put a sales notice of the regional bank affiliates on July 15.

But the FSC has extended its time frame for the start of Woori Bank's sale to early next year as it intends to provide the best possible chance for potential bidders to buy the banking giant worth 266 trillion won (US$230.9 billion) and not to repeat the thwarted sales in 2010 and 2011.

The sale of its brokerage-related units, including Woori Investment