Industrial Bank of Korea said it was considering a move into the securities business, responding to a report that the bank, South Korea's largest lender to small companies, could bid for the domestic brokerage KGI Securities Co (中信證券).
Industrial Bank, Kookmin Bank and Dongbu Securities Co are among more than 10 bidders vying to acquire the 51 percent stake in KGI Securities owned by Taiwan's Koos Group, Korea Economic Daily reported earlier yesterday. Koos Group, which runs businesses ranging from banking to telecommunications, could have begun short-listing bidders yesterday, the report said.
No decision has been made on an entry into the securities business, said Cho Sung-kon, a spokesman at Industrial Bank, declining to comment on the KGI Securities report.
South Korea's banks and brokerages are seeking to become more competitive ahead of an integration of the nation's capital markets that will let brokers handle settlements and allow overseas firms to offer financial services to individuals.
The Koos Group took over Seoul-based KGI Securities in 2000.
Shinhan Financial Group Ltd holds a stake of 8.76 percent in the firm, which posted 8.1 billion won (US$8.7 million) profit for the nine months ended last December, down from 15.7 billion won in the same period last year.
Choi In-seok, a spokesman at Kookmin, the nation's largest bank by assets, and Park Jun-ho, a spokesman at Dongbu Securities, declined to comment on the report.
In response, the parent company of KGI Securities said it plans to sell its 51.6 percent holdings in the Korean subsidiary and has hired a financial advisory agency to screen buyers' offers.
The parent company had not heard from Industrial Bank of Korea as an interested buyer and could not make any comment, KGI Taiwan spokeswoman Janet Sheng (盛嘉珍) told the Taipei Times in a telephone interview yesterday.
The company has not set any timetable. Progress will depend on price for the share sale, Sheng said.
The parent company in Taiwan had no further information about the offers, she said.
KGI Taiwan has put its majority holdings on offer as the Korean government pushes for consolidation of the securities industry.
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