The Ministry of Strategy and Finance said Monday that the government would consider re-designating KDB Financial, Korea Development Bank and the Industrial Bank of Korea as “public institutions.”
The Finance Ministry said that it planned to look into the possibility of including the state-controlled banks in its category of public-sector enterprises during its regular meeting next month.
“The government will consider the option of reclassifying KDB Financial, KDB Bank and IBK as public institutions in late January next year,” the Finance Ministry said in a statement on Monday.
It added that the Financial Services Commission, the regulatory policymaking body, had not filed a request to the Finance Ministry for such a consideration as media had reported.
Failure to privatize the banks as planned has led the government to consider the option.
The government separated KDB Bank into two financial companies ― KDB Financial and Korea Finance Corp. ― in 2009 as part of the Lee Myung-bak administration’s plan to privatize KDB Financial and its subsidiaries.
KDB Financial focused on commercial and investment banking, and KoFC on policy loans and financing for small and medium enterprises. KDB Financial is wholly-owned by the government and KoFC, whose management jurisdiction falls under the FSC.
In 2012, the former government delisted KDB Financial, KDB Bank and IBK from its classification of public organizations on condition that they would be privatized by 2014.
However, the Finance Ministry said early this year that it would be difficult to privatize the banks due to political setbacks and other reasons.
It said then that it would be “realistically” difficult to reach a consensus among National Assembly lawmakers, the presidential office and related ministries for the KDB privatization.
Also, the government announced in March this year that it would retain its majority stake in IBK, so that it can continue to support SMEs through the bank.
The Finance Ministry has a 64.6 percent stake in IBK after selling a total of 23.24 million shares, or 4.2 percent, in a block sale last month.
By Park Hyong-ki (
hkp@heraldcorp.com)
