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Kang clashes with GNP over mega-bank

KDB Financial Group chairman Kang Man-soo has clashed with lawmakers of the governing Grand National Party over the issue of launching a mega-bank here.

Kang, a close confidant of President Lee Myung-bak, is pushing ahead with a merger between KDB Financial and public fund-injected Woori Financial Group.
KDB Financial Group chairman Kang Man-soo
KDB Financial Group chairman Kang Man-soo

But, aside from opposition lawmakers, a group of GNP lawmakers have continued to express skepticism about the emergence of a mega-bank and Kang’s philosophy on economic issues.

They downplayed Kang’s philosophy that the nation should have a mega-bank for international financial competitiveness.

“The merger scenario between the two state-run banks is going against the government-led long-term project to privatize the two banks,” Rep. Lee Sa-churl of the GNP said.

Fellow GNP Rep. Cho Moon-hwan criticized the Financial Services Commission’s move to revise banking laws in an apparent bid to give benefits to KDB Financial for its M&A project.

The ruling party lawmakers also criticized the past economic policies of Kang who worked as the first Finance Minister under the Lee administration for deepening income disparity between the haves and have-nots.

“Economic policies of President Lee Myung-bak have been based upon academic economics of Kang Man-soo and his followers,” Rep. Kim Sung-tae of the GNP said.

Kang struck back against the lawmakers’ views in a recent interview with a local news daily.

“The ruling party is watering down core economic policies of the Lee administration,” Kang said. “I think the lawmakers are only afraid of the public opinion.

“We need to take time to verify the efficacy of the mega-bank issue as the direction has already been set under state policies.”

He also criticized lawmakers for putting the brakes on the merger plan without suggesting any particular alternative.

The financial authorities plan to hand over the state-controlled Woori Financial to an investor through a bidding competition by September.

KDB Financial reportedly tops the list of potential buyers after Kang indicated his intention to join the takeover race earlier in May.

By Kim Yon-se (