Most Popular
-
1
1 in 3 Koreans live alone, family types becoming diverse
-
2
Korea, Japan finance chiefs vow to tame rampant FX market volatility
-
3
US 'incredibly concerned' about suspected NK-Iran military ties
-
4
Korean won weakens amid heightened uncertainty
-
5
Sewol victims commemorated on tragedy's 10th anniversary
-
6
K-pop group's manager dismissed for setting up spycam in theater dressing room
-
7
Chanel, Louis Vuitton see muted growth in Korea
-
8
K-pop singer lost consciousness after being hit by foul ball, cancels show
-
9
Conservative bloc divided over Han’s role in election defeat
-
10
Korean Muslim YouTuber's plan to build mosque in Incheon goes viral
FSC delays ruling on Lone Star’s shareholder eligibility to April 27
Korea Exchange Bank has been barred from operating deposit businesses in the U.S. since Lone Star Funds took over the lender in 2003, in contrast to Korea where there have been no such restrictions, sources said Sunday.
The restriction indicates that U.S. regulators regard Lone Star as a non-financial investor, they said.
“It seems that KEB, which holds many overseas branches, had to close down some of its North American corporations or halt some of its businesses at branches under U.S. laws,” a local banker said.
The disparity is drawing interest as Korean financial regulators, including the Financial Services Commission, said last month that the Texas-based buyout fund cannot be classified as a non-financial investor.
In December Hana Financial Group applied for regulatory approval of its plan to acquire KEB, and the FSC has been pressured to rule on whether the fund was eligible to buy KEB as the biggest shareholder in 2003.
A month ago, the regulator declined to make a clear ruling on whether the U.S. buyout fund was a “financial” investor which could be entitled to control a Korean financial company.
“We believe that Lone Star is not a non-financial investor,” a senior FSC official told reporters. “But an additional review of whether the fund satisfies the full requirement to become the majority shareholder of KEB would be needed.”
Amid criticism in the market on the regulator’s ambiguous stance, even a high-ranking official of the Financial Supervisory Service, an executive arm of the FSC, said he was disappointed with the announcement.
Questioning the definition of “not a non-financial investor,” the FSS official said, “The FSC should have ruled only between financial and non-financial.”
He shared the view ― among a large portion of the public ― that the financial authorities should be straightforward about the long-standing KEB-Lone Star issue.
Though the FSC had been expected to make an updated ruling on the U.S. fund at its bi-weekly panel meeting on April 20, the regulator said it has decided to delay the regular meeting to April 27.
While an FSC official said the postponement is due to a scheduled absence of three members of the nine-member panel on April 20, civic groups are issuing speculations that the regulator is seeking to avert growing criticism among the public.
April 27 is the day when bi-elections to select two lawmakers and a provincial governor will be conducted.
The lingering situation comes after a ruling of the Supreme Court in early March that the former CEO of Lone Star Korea could be implicated in stock manipulation of an affiliate of KEB in 2003.
The Supreme Court has sent back the case to the Seoul High Court for retrial, which appears to be an embarrassment for the FSC.
By Kim Yon-se (kys@heraldcorp.com)
Korea Exchange Bank has been barred from operating deposit businesses in the U.S. since Lone Star Funds took over the lender in 2003, in contrast to Korea where there have been no such restrictions, sources said Sunday.
The restriction indicates that U.S. regulators regard Lone Star as a non-financial investor, they said.
“It seems that KEB, which holds many overseas branches, had to close down some of its North American corporations or halt some of its businesses at branches under U.S. laws,” a local banker said.
The disparity is drawing interest as Korean financial regulators, including the Financial Services Commission, said last month that the Texas-based buyout fund cannot be classified as a non-financial investor.
In December Hana Financial Group applied for regulatory approval of its plan to acquire KEB, and the FSC has been pressured to rule on whether the fund was eligible to buy KEB as the biggest shareholder in 2003.
A month ago, the regulator declined to make a clear ruling on whether the U.S. buyout fund was a “financial” investor which could be entitled to control a Korean financial company.
“We believe that Lone Star is not a non-financial investor,” a senior FSC official told reporters. “But an additional review of whether the fund satisfies the full requirement to become the majority shareholder of KEB would be needed.”
Amid criticism in the market on the regulator’s ambiguous stance, even a high-ranking official of the Financial Supervisory Service, an executive arm of the FSC, said he was disappointed with the announcement.
Questioning the definition of “not a non-financial investor,” the FSS official said, “The FSC should have ruled only between financial and non-financial.”
He shared the view ― among a large portion of the public ― that the financial authorities should be straightforward about the long-standing KEB-Lone Star issue.
Though the FSC had been expected to make an updated ruling on the U.S. fund at its bi-weekly panel meeting on April 20, the regulator said it has decided to delay the regular meeting to April 27.
While an FSC official said the postponement is due to a scheduled absence of three members of the nine-member panel on April 20, civic groups are issuing speculations that the regulator is seeking to avert growing criticism among the public.
April 27 is the day when bi-elections to select two lawmakers and a provincial governor will be conducted.
The lingering situation comes after a ruling of the Supreme Court in early March that the former CEO of Lone Star Korea could be implicated in stock manipulation of an affiliate of KEB in 2003.
The Supreme Court has sent back the case to the Seoul High Court for retrial, which appears to be an embarrassment for the FSC.
By Kim Yon-se (kys@heraldcorp.com)
![[Today’s K-pop] BTS pop-up event to come to Seoul](http://res.heraldm.com/phpwas/restmb_idxmake.php?idx=642&simg=/content/image/2024/04/17/20240417050734_0.jpg&u=)