KB Financial Group Inc. submitted a bid Monday to acquire the local unit of global insurance giant ING Group, as the group scrambles to expand its presence in the fast-growing insurance market, industry sources said.

Korea’s No. 2 banking group made its bid to buy ING Life Korea, the fourth-largest in the country by market share, in a deal worth of around 3.5 trillion won ($3.04 billion), according to sources.

AIA Group, the multinational life insurer, is also believed to have submitted a bid for ING Life Korea, which is affiliated with the Asia-Pacific subsidiary of the Dutch firm, market watchers said, but the company declined to confirm that.

ING plans to announce its preferred bidder at the end of the month. In May, KB Financial and AIA were picked in the shortlist after they each submitted a letter of intention earlier that month.

Analysts said if KB Financial takes over the life insurer, the lender will be able to use its 1,160 local branches to handle ING Life’s non-banking businesses such as bancassurance. For AIA, it will lift its ranking in Korea to fourth from its current 10th, a significant expansion in Asia’s fast-growing insurance market, they said.

Meanwhile, Korea Life Insurance, the country’s second-largest life insurer, submitted a bid to buy the southeastern operations of ING Group, which include operations in Malaysia and Thailand, according to industry sources.

Despite interest shown by financial institutions, a smooth bidding process could hit a snag on strike movements by ING Life’s unionized workers, who announced last week they will stage a walkout if prospective new owners do not ensure job security. 

(Yonhap News)