Hana-KEB merger could face delay

Hana Financial Group’s ambitious plan to merge its two flagship banks ― Hana Bank and Korea Exchange Bank ― is likely to face another delay due to their discord on how to convert the banks’ contract workers into regular employees.

A news report said the management-labor talks had gone astray and the plan to promote some 3,400 contract workers returned to square one. The number includes 2,000 KEB employees and 1,400 Hana employees.

But the financial group denied the report, calling it groundless.

“Hana Financial clearly agreed to promote the employment status of the irregular workers, but the problem is when and how it will do it,” a group spokesperson said.

The financial group suggested on Tuesday that it would convert the irregular employees to regular ones within a month of the bank merger, making visible progress in the long-stalled talks.

But the KEB labor union had repeatedly demanded that the promotion should come before the merger ― the thorniest issue that has delayed the target merger date of between Feb. 1 and March 1.

But group officials did not rule out the possibility that the merger may be further delayed, should the two sides fail to reach an agreement on the details soon.

In order to launch an integrated bank in March, the financial group must submit an application to the Financial Services Commission this month for approval of the merger.

The FSC said earlier that the two counterparts must strike a deal on the labor conditions before moving on with the merger plan.

“The bank merger is the single most important project for Hana Financial Group, not only for this year but for its future,” the spokesperson said.

“Despite remaining difficulties, we believe that we have jumped most of the hurdles. It is now up to the union to decide whether it will accept the deal or not.”

Last year, the financial group recorded 943 billion won ($858 million) in net profit, down from 1.3 trillion won in 2011.

By Bae Hyun-jung (tellme@heraldcorp.com)