Samsung Card Completed Share Buyback

According to industry sources, Samsung Card completed the repurchase of 5.79 million shares, which had been posted publicly on August 31, on November 17, 11 days ahead of schedule.

Experts predict that Samsung Card is going to become a fully-owned subsidiary of Samsung Life Insurance in the near future. At present, Samsung Life Insurance has 30.1% shares in Samsung Securities, 71.86% in Samsung Card, 15.9% in Samsung Fire & Marine Insurance and 98% in Samsung Asset Management, which means it can become a financial holding company after share repurchase by Samsung Fire & Marine Insurance.

Samsung Card is expected to reduce its capital sooner or later so that its surplus capital can be transferred to Samsung Life Insurance. As of the end of March this year, Samsung Card recorded an adjusted capital adequacy ratio of 37%. Meanwhile, Samsung Life Insurance needs to expand its capital with 700 billion won having been spent on the purchase of Samsung Securities shares and the Risk Based Capital (RBC) having been adopted ahead of Phase 2 of IFRS 4.

The stock price of Samsung Card fell 14.3% from 50,900 won to 45,050 won between September 1 and November 17. “The fall in stock price means a large number of options Samsung Life Insurance can choose from,” said a local securities firm, adding, “Samsung Life Insurance will be able to secure shares on the market with ease from foreign and minority shareholders even in the case of tender offer at a price of 60,000 won or so.”