HSBC Best Option for KEB: Wacker
By Na Jeong-ju
Staff Reporter
Korea Exchange Bank (KEB) CEO Richard Wacker said Thursday HSBC Holding's takeover of KEB will provide a crucial opportunity for the bank to expand its overseas business network and improve its long-term competitiveness.
Wacker's view on HSBC's bid to buy a majority stake in KEB reflects KEB's current owner Lone Star Funds' assessment on the deal, which caused mixed responses here amid rising anti-foreign capital sentiment.
``At this point, HSBC is the best option for KEB ... to improve its business capabilities and pursue long-term growth,'' Wacker told reporters in Seoul.
After signing a $6.3 billion deal with Lone Star to buy KEB, HSBC said it will submit an application to South Korean regulators to approve the sale. However, the Finansial Services Commission has been cynical about the deal, saying it is not in a position to review the matter until a court delivers a verdict on a pending case involving Lone Star.
Wacker said uncertainties regarding the stake sale are weighing on the country's sixth largest lender, calling on regulators to make a decision as soon as possible for the bank's future.
``We understand the stance of regulators on the sale of our bank ... but we hope we will be able to get a decision as soon as possible,'' Wacker said.
Some analysts say HSBC's aggressive tactics to pressure the Financial Supervisory Commission to approve its takeover of KEB have backfired and turned regulators more hard-line on the deal.
If regulators do not approve the deal, HSBC must scrap the contract it signed with Lone Star. Given that regulators are sticking to their original stance about the contract and the opposition of some civic groups, it may be difficult for HSBC to complete the acquisition at an early date.
Regarding concerns about possible nullification of the contract, Wacker said he expects HSBC to submit an application to the FSC for endorsement of the deal by the end of January. If there is no regulatory approval by the end of April, either HSBC or Lone Star can cancel the contract, but that won't happen, he said.
``I don't think the contract with HSBC will be terminated,'' he said.