Chaebols' financial affiliates urged to sell non-financial shares

The top financial regulator has called on financial affiliates of family-run business conglomerates, or chaebol, to map out plans to sell their stocks in non-financial affiliates.

The remarks by Financial Services Commission Chairman Choi Jong-ku on Friday were seen as a veiled warning to Samsung Life Insurance Co., which holds an 8.27 percent stake in Samsung Electronics Co.

Lawmakers proposed a bill that bans insurers from holding a more than 3 percent stake in non-financial affiliates. If the bill becomes law, Samsung Life Insurance would have to sell a part of its stake in Samsung Electronics.
Choi said it is "not desirable" for financial firms to do nothing on the matter until the bill becomes law. 

Choi called for financial firms to "actively come up with plans" to unload their stocks in non-financial affiliates, without referring to Samsung Life Insurance by name.

Another financial affiliate of Samsung Group, Samsung Securities Co., has been under a firestorm of criticism after it mistakenly paid stocks to its employees as dividends in a "fat-finger" error.

Samsung Securities accidentally issued 112 trillion won worth of "ghost" stocks earlier this month and 16 employees at the brokerage sold off a combined 5.01 million shares.

Choi said financial authorities will "sternly punish" those responsible for the dividend chaos at Samsung Securities after the results of inspection into the brokerage come out.(Yonhap)