KEB-Hana merger gets preliminary approval

By Kim Jae-won

The financial regulator said Wednesday that it gave preliminary approval to a plan to merge Korea Exchange Bank and Hana Bank submitted by Hana Financial Group.

The Financial Services Commission (FSC) said the group can pursue the merger of its two banking affiliates. The regulator will interview executives and examine corporate governance of the new bank when the group applies for full approval of the merger.

The preliminary approval came a few weeks after the trade union of KEB agreed with the group to merge the two lenders earlier than previously promised. Hana accepted the union’s requests to keep KEB employees’ working conditions and maintain the name of the lender in its new merged bank.

Hana plans to launch the new bank, tentatively named KEB Hana Bank, in September. Hana bought a 51 percent stake in KEB from U.S. private equity Lone Star Funds in 2012 at 4.7 trillion won.