By Na Jeong-ju
Staff Reporter
Kookmin Bank, the country's largest, is negotiating terms with a mid-tier Kazakhstan commercial lender to acquire it, the bank said Tuesday.
``We've met with managers of JSC Bank CenterCredit to discuss the terms of our acquisition of the bank,'' a Kookmin official said. ``There are still many things to be done to complete the deal. We are talking about the price and the date for signing.''
CenterCredit is the sixth largest lender in Kazakhstan, with strengths in retail banking, pension fund management, stock trading and real estate leasing service. It has three affiliates in Kazakhstan and one subsidiary in the Netherlands, according to Kookmin.
As of the end of September, its assets totaled $7.5 billion, up 67 percent from a year ago. Since 2002, its household loans have grown by over 130 percent annually, as the country pushed for economic development, Kookmin said.
Media reports said Kookmin will spend a total of one trillion won over the next three years to increase its stakes in the Kazakhstan lender. The bank plans to acquire a 30 percent stake for some 600 billion won this year on condition that it can demand an additional 20.1 percent in 2011.
Kookmin officials refused to confirm the reports, saying it was not appropriate to talk about sales terms when negotiations were still making progress.
``If things go smoothly, we will hold a board meeting in a month or two to approve the acquisition and have a signing ceremony in Kazakhstan,'' the official said.
If the reports are true, it will be the largest acquisition deal by a South Korean lender in overseas markets.
There has been a significant change in the way South Korean banks make inroads into global markets. In the past, they set up branches to serve only Korean clients. These days, however, they tend to seek mergers with local lenders, preparing to launch financial services not only for Korean firms operating there but for local corporate and retail clients as well.
In December, Hana Bank acquired a 61 percent stake in PT Bank Bintang Manunggal, a tiny Indonesian bank with $30 million in assets, for 3 billion won ($3.3 million).
Shinhan Bank also acquired the North America National Bank, a small-sized U.S. bank based in Atlanta, Georgia, for $29 million.
Kookmin CEO Kang Chung-won earlier said the lender is looking to take over controlling stakes in unspecified banks in Indonesia and Kazakhstan as part of its global expansion strategy. He said Kookmin will become a majority stakeholder in banks in some Asian markets, and set up operations in China and Vietnam.
According to Kang, Kookmin is talking with Singapore's state-owned investment firm, Temasek Holdings, about how to rearrange shareholding in Bank International Indonesia (BII), which is controlled by a consortium that includes Kookmin, Temasek and Britain's Barclays Plc.
Kookmin holds a 14.06 percent stake in Indonesia's sixth largest bank, and there is speculation that it may buy Temasek shares in BII to secure managerial control.