Central bank to sell KEB stake

The central bank said Friday it will take steps to sell off its entire stake in Korea Exchange Bank (KEB), with proceeds to go into government coffers.

The Bank of Korea (BOK) said its holdings in the commercial bank stand at 39.5 million shares or 6.12 percent of the lender's 644.9 million shares. They are worth 327 billion won (US$277.3 million) at present market prices.

Sales of the shares are scheduled to start Tuesday with BOK charged with selling its holdings without disrupting the local stock market. No deadline has been set on when sales must be completed, the bank said.

KEB shares, which closed at 8,280 won earlier in Friday, can be sold on the main bourse or through outside dealings including a negotiated contract with a designated buyer.

"Disposal of stocks will be decided by market conditions and how best to get the most out of the sale," the BOK said.

The bank invested 395 billion won from 1996 through 1985 to set up the state-run specialized bank. KEB, however, became a normal commercial bank in 1989, making it unnecessary for the central bank to inject more money into the lender, although BOK retained its stake.

KEB, meanwhile, was bought by Korea's No. 4 banking group, Hana Financial, earlier this year after protracted negotiations with U.S. buyout fund Lone Star Funds. (Yonhap)