ID :
186518
Sun, 06/05/2011 - 09:37
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Shortlink :
https://oananews.org//node/186518
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S. Korea to resume sale process of 4 suspended savings banks
SEOUL, June 5 (Yonhap) -- The sale process of South Korea's four suspended savings banks will resume next week following the government's recent failed attempt to find potential buyers for the troubled lenders, industry sources said Sunday.
The government suspended seven savings banks earlier this year due to their capital shortages caused by soured construction loans.
Ever since, the state-run Korea Deposit Insurance Corp. (KDIC), which took over their control, has been pushing to sell the lenders.
On May 30, the nation's major financial groups handed in their letters of intent (LOI) to buy a package of some of the savings banks. But four of them -- Busan Savings Bank, Jeonju Savings Bank, Daejeon Mutual Savings Bank and Bohae Mutual Savings Bank -- failed to draw a sufficient number of potential buyers to push through the sale process.
"The sale method for the four savings banks will be determined within this week before the start of the official sale process," a KDIC official said. "We will consider both selling them separately or in a package."
Industry sources said that the sale process will officially resume next week at the earliest.
The KDIC earlier pushed to sell Busan Savings Bank and Jeonju Savings Bank in a package, while seeking to sell Daejeon Savings Bank along with Bohae Mutual Savings Bank.
However, for the former sale, only a single company expressed its purchase intention with none coming out for the latter Daejeon-Bohae deal.
South Korea's financial sector has been gripped by the struggling savings banks, which saw much of their debt go sour after the construction slump hampered their recoup of loans offered to local builders.
The savings bank crisis drew further attention as some executives and major shareholders at those troubled lenders have been arrested or indicted on charges of illegal loan issuance and mismanagement of depositors' money.
The government suspended seven savings banks earlier this year due to their capital shortages caused by soured construction loans.
Ever since, the state-run Korea Deposit Insurance Corp. (KDIC), which took over their control, has been pushing to sell the lenders.
On May 30, the nation's major financial groups handed in their letters of intent (LOI) to buy a package of some of the savings banks. But four of them -- Busan Savings Bank, Jeonju Savings Bank, Daejeon Mutual Savings Bank and Bohae Mutual Savings Bank -- failed to draw a sufficient number of potential buyers to push through the sale process.
"The sale method for the four savings banks will be determined within this week before the start of the official sale process," a KDIC official said. "We will consider both selling them separately or in a package."
Industry sources said that the sale process will officially resume next week at the earliest.
The KDIC earlier pushed to sell Busan Savings Bank and Jeonju Savings Bank in a package, while seeking to sell Daejeon Savings Bank along with Bohae Mutual Savings Bank.
However, for the former sale, only a single company expressed its purchase intention with none coming out for the latter Daejeon-Bohae deal.
South Korea's financial sector has been gripped by the struggling savings banks, which saw much of their debt go sour after the construction slump hampered their recoup of loans offered to local builders.
The savings bank crisis drew further attention as some executives and major shareholders at those troubled lenders have been arrested or indicted on charges of illegal loan issuance and mismanagement of depositors' money.
