2 Banks to Unite, Form S. Korea’s Largest
SEOUL — Two of South Korea’s stronger financial institutions, Kookmin Bank and Korea Long Term Credit Bank, said Friday they agreed to merge in a deal that would create the country’s biggest bank.
The deal, the third bank merger announced in two months as South Korea continues its financial reforms, would create a bank with nearly $74 billion in assets. The banks said a price would be set later and that the combined bank would seek capital from foreign sources.
The reforms came after the International Monetary Fund arranged a $58.5-billion bailout last year. Seoul has asked commercial banks to strengthen finances and has shut down five ailing banks, which are giving key assets and operations to healthier institutions. Kookmin is already merging with Daedong Bank as a result.
Kookmin is one of the country’s strongest banks, with an emphasis on consumer lending, while Korea Long Term Credit focuses on providing loans to corporations.
Presidents Song Dal-ho of Kookmin and Oh Sei-jong of Long Term Credit Bank signed an agreement to merge as of Jan. 1, 1999, the companies said in a statement. Kookmin would be the acquiring firm, the statement said.
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