As the 29.7 percent stake in Woori Bank passed from the government to private investors in 16 years on December 1, the new management system of Woori Bank has finally begun.
On the same day, the state-run Korea Deposit Insurance Corporation (KDIC), the largest shareholder of Woori Bank, signed a deal with seven institutional investors on the sale of Woori Bank at the headquarters in Cheonggyecheon-ro, Seoul. Under the deal, Seoul-based IMM Private Equity will acquire the largest stake in Woori Bank, 6 percent, while Asset Global Investments Co. is acquiring the smallest portion, 3.7 percent. Tongyang Life Insurance Co. owned by China's Anbang Insurance Group Co., Eugene Asset Management Co., Kiwoom Securities Co. and Korea Investment & Securities Co. will each buy a 4 percent stake. In particular, five firms, excluding Mirae Asset Global Investments and Eugene Asset Management, have declared their direct participation in the management of Woori Bank by appointing outside directors, they are now occupying an important position to decide on the future of Woori Bank.
Gwak Bum-gook, head of the KDIC, said, “We will entrust a new group of oligopolistic stockholders with full powers so that it can decide on the overall management issues of Woori Bank, such as the appointment of a new head of the bank and change of the holding company. We will sell the remaining stake in Woori Bank as soon as the market situation improves.”
Heads of the selected investors, who gathered for the first time on the day, agreed to be an exemplary model that oligopolistic stockholders plays a decisive role in improving the governance structure of the bank. They also agreed to meet as much as possible at board meetings and other channels in order to discuss the management of Woori Bank.
As the new governance structure has outlined, Woori Bank is working on a new business strategy, including the change of holding company, cooperation with securities and insurance businesses and expansion of overseas business areas. Oligopolistic stockholders, such as Hanwha Life, Tong Yang Life Insurance, Kiwoom Securities and Korea Investment & Securities, agreed that it is necessary to change the holding company in a bid to maximize a synergy with the bank so they will push ahead as soon as a new board of directors is formed. They plan to recommend new outside directors at the board meeting to be held on the 9th and select new outside directors at the general stockholders’ meeting on the 30th.
In addition, the new board of directors to be led by them is expected to seek to relist on the stock market and negotiate with financial authorities with a goal of changing the holding company in the first half of next year. Among oligopolistic stockholders, Tong Yang Life Insurance expects to strengthen the domestic bancassurance market through Woori Bank, while Hanwha tries to target the bancassurance market in Southeast Asia, including Vietnam and Indonesia. Kiwoom Securities and Korea Investment & Securities also expect to sell funds and make use of Woori Bank’s capital power to jump into a mega investment bank.
An official from Woori Bank said, “Hanwha Life, Tong Yang Life Insurance, Korea Investment & Securities and Kiwoom Securities are among the top leaders in relevant sectors in the investment banking industry. Compared to the non-banking sector in other financial holding companies, Woori Bank’s oligopolistic stockholders has a bigger size and power. Accordingly, the collaboration in banking and non-banking sectors between Woori Bank and oligopolistic stockholders will be able to create a greater synergy.”