KDB to Be Split into 3 Parts for Privatization

The government decided to split Korea Development Bank into a holding company, a bank and a policy body in preparation for the bank's privatization.

The Financial Services Commission on Tuesday said the division will happen by October. It plans to set up the holding firm and policy finance corporation and turn the bank into a subsidiary of the holding company.

Shares of financial firms, public corporations, and companies in debt workout programs held by KDB will be distributed among the three new firms. The holding company will take over KDB-held shares in financial firms including Daewoo Securities, KDB Capital, KDB Asset Management, and Infrastructure Asset Management.

The policy finance corporation will take over all W15.1 trillion (US$1=W1,238) worth of KDB-held shares in  public corporations like KEPCO, Korea Expressway Corporation, Korea National Housing Corporation, and Korea Land Corporation. It will also get shares in some companies in debt workout programs such as Hyundai Engineering & Construction, Hynix, SK Networks, Korea Aerospace Industries, and Daewoo International. As a result, the policy finance corporation will hold a total assets of W28 trillion.

englishnews@chosun.com / Jul. 29, 2009 09:38 KST