Bo-eun leads the digital content team. She has covered foreign affairs, North Korea, tech, economy and gender issues at The Korea Times. She did a short stint at the South China Morning Post in Hong Kong, where she obtained a new perspective on news production and life. Small sources of joy for her are lounging in the sun, having a good latte and swimming.
Will Woori privatization make progress this year?
Woori Financial Group's headquarters in central Seoul. / Korea Times file
By Kim Bo-eun
By Kim Bo-eun
The government's sale of shares in Woori Financial Holdings ― enabling the full privatization of the group ― has remained pending for the past year.
The Financial Services Commission's plan unveiled last year was to start selling Woori shares held by the government via the Korea Deposit Insurance Corp. this year and complete the sale by 2022.
But the Public Funds Management Committee (PFMC) meeting on Oct. 26 did not decide on any action plan for the immediate future.
The government had sought to push forward with the plan as soon as circumstances allowed, but Woori's share price has stopped authorities from acting.
Government shares in Woori represent funds that were poured in to keep the bank afloat during the Asian Financial Crisis of 1997. The government injected 12.8 trillion won, of which 11 trillion won has been recouped.
Woori's share price needs to be at least 12,350 won for the government to recoup the remainder.
It exceeded 10,000 won in January, but has showed a downtrend over the year and has failed to recover to the pre-COVID-19 level after the stock market plunge in March.
Prices have continued to hover below 10,000 won in recent months, after exceeding 10,000 won in early June.
The PFMC will convene two more meetings this year, where the sale agenda will likely be addressed.
“The matter regarding Woori Financial will be discussed in the case this is deemed necessary,” an official said Monday.
He said the committee usually draws a roadmap of plans for the year in February or March.
Regulations on the selloff of Woori shares state that this should be done as soon as possible, while enabling the retrieval of public funds and contributing to the development of the finance industry. Achieving all three goals appears to be tricky, as some conflict with each other. Authorities have forgone a swift sale in a bid to recoup all the money.
Woori Group Chairman Son Tae-seung bought back a total of 20,000 company shares on four occasions this year to boost the stock price.
Financial holding groups' stock prices have remained lackluster this year. The four major groups ― KB, Shinhan, Hana and Woori ― are yet to recover to pre-COVID plunge levels. This has been attributed to the prospects of traditional financial institutions' decline amid the potential identified in big-tech firms' financial service business.
But in recent weeks, financial holding groups' stock prices have risen, as the companies provide dividends at the end of the year.
The KDIC is Woori's largest shareholder, owning 17.25 percent of shares. Other shareholders with over 5 percent include the National Pension Service (9.88 percent) and the employee stock ownership association (7.44 percent).