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Gov't to sell Woori Finance in 3 batches by 2014

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(Globalpost/GlobalPost)

By Kim Seung-yeon

SEOUL, June 26 (Yonhap) -- The government said Wednesday that it plans to sell Woori Finance Holdings Co. in three batches by the end of next year, its fourth attempt since 2010 to recoup massive amounts of taxpayers' money, which were spent to save the country's largest banking group.

The Financial Services Commission (FSC), the country's financial regulator, said it will put 14 units of Woori Finance up for sale in the three groups -- its mainstay Woori Bank, two regional banks, and other units including a brokerage house -- in a bid to save a potential buyer's financial burden, thus quickening sales procedures.

Since 2001, the government has injected a total of 12.8 trillion won (US$11.1 billion) into Woori Finance under which then four troubled banks -- Hanvit, Peace, Kwangju and Kyongnam -- and one merchant bank were merged as they were saddled with massive soured debts in the aftermath of the 1997-98 Asian financial crisis.

Since then, the group has grown into South Korea's top banking group by assets through takeovers, with its asset totaling 325.7 trillion won as of the end of last year.

If pulled through, the sale of the country's No. 1 banking firm by assets is expected to be a landmark achievement for the Park Geun-hye administration, as previous attempts to privatize the group were botched due to lack of adequate buyers.

"We chose to hive off affiliates as the sale plan, since our main purpose is to return the banking group to the market," Shin Je-yoon, the FSC chairman told reporters.

The first batch up for sale would be two regional banking units, according to the regulator.

The FSC said it will merge two affiliates -- Kwangju Bank and Kyongnam Bank -- into their respective holding company to be set up in the near future, with the deal to be completed in the first half of 2014.

The regulator said it aims to sell Woori Bank, the flagship banking unit, by the end of next year in a bid to woo more potential bidders for the banking giant whose assets are worth 266 trillion won.

Woori Bank 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 sale of its brokerage unit and other affiliates, including Woori Investment

http://www.globalpost.com/dispatch/news/yonhap-news-agency/130626/govt-sell-woori-finance-3-batches-2014