South Korea will delay the announcement of a plan to privatize Woori Finance Holdings Co. until mid-July as details have yet to be sorted out, the chief of the financial watchdog said
Wednesday.
The Financial Services Commission (FSC) originally planned to disclose the plan to dispose of a 57 percent government stake by the end of June and select a preferred bidder by the end of the year as part of government
efforts to privatize government-held stakes in several companies.
"The delay is due to the fact that the Public Fund Oversight Committee has yet to finalize the plan," FSC Chairman Chin Dong-soo told reporters.
"It is a quite a tough job and the discussion is now in the final stage."
He added the decision is being delayed by the European debt crisis and other global issues such as debates in the Group of 20 leading economies,
which called for tougher regulation of banks.
Market participants have been awaiting the announcement as the privatization plan is widely expected to make a sea of changes in the
banking landscape with some speculating over the rise of a mega bank.
"The public fund committee will go ahead with wrapping up the plan as soon as the officials return in mid July," Chin said. "The government plan to privatize Woori Finance as soon as possible has not changed."
The chairman reiterated that Seoul will push for the Woori Finance privatization based on three core principles in which the sale will fetch the maximum public fund retrieval, contribute to the development of the local banking sector and ensure that necessary measures take place in a timely manner.
South Korea acquired the company in 2001 after injecting 12.8 trillion won (US$10.5 billion) in public funds to bail out Woori Bank and a handful
of financial companies that later merged into the second-largest financial services firm in the country.
The state-run Korea Deposit Insurance Co., which holds the interest, has slashed it down to 57 percent following an initial public offering and several rounds of block sales.
Top banking group KB Financial Group Inc. and smaller rival Hana Financial Group Inc. have both expressed interest in taking over the stake
estimated at 13 trillion won.