Watchdog, central bank to inspect KDB Financial

SEOUL, May 25 (Yonhap) -- South Korea's financial watchdog said Wednesday it and the central bank will launch a joint inspection of state-run KDB Financial Group Inc. and its bank unit next month.
The Financial Supervisory Service (FSS) said the joint inspection, to be conducted between June 8 and July 5, is part of regular bank checkups aimed at examining asset quality, computer system security and other internal management.
The FSS has exempted KDB Financial and bank unit Korea Development Bank from such checkups for the last four years so as to help reduce burdens on the state-owned firms that undergo regular probes by the country's audit agency.
The FSS said the resumption of inspection is only a part of regular supervisory activities, but market watchers raised speculation that it could be linked to the financial group's attempt to take over a major stake in Woori Finance Holdings, another state-run financial holding company.
The government is now accepting letters of intent to buy its 56.97 percent stake in the second-biggest financial group in order to privatize the financial group rescued from bankruptcy using taxpayers' money.
KDB Financial is being considered as the foremost prospective buyer of the controlling share in Woori Finance Holdings.
pbr@yna.co.kr