Gov't to sell Woori shares by 2022

By Park Hyong-ki

The government will sell its remaining 18.3 percent stake in Woori Financial Group by 2022, the Financial Services Commission (FSC) said Tuesday.

Regardless of whether the stock price goes up or down, the state-run Korea Deposit Insurance Corp. (KDIC) will start liquidating its Woori shares in 2020.

It will not sell the shares all at once, but offload them in sequence by first offering KDIC's 10 percent stake in Woori to the highest bidder or large investors.

The KDIC will then unload the rest via block sales. A single sale process could take six months to a year, depending on investors' demand, it noted.

The government will also consider selling Woori shares to institutional investors recommended by the financial holding company's board.

Public Fund Oversight Committee Chairman Park Jong-won holds a meeting to discuss Woori Financial's stake sale at the Korea Deposit Insurance Corp. headquarters in Seoul, June 24. Yonhap

This sales roadmap came after the Public Fund Oversight Committee chaired by Park Jong-won held a June 24 meeting to discuss the sale.

The FSC set up the committee to make decisions on institutions funded with state capital. The state-run KDIC is under the jurisdiction of the FSC.

"We will pursue this sales plan without further delay," Lee Se-hoon of the FSC's restructuring policy bureau told the press.

It added it will carry out the plan while trying to strengthen Woori Financial's governance.

The FSC admitted that it had been "too mindful of and concerned with" Woori's stock price because it sought higher returns.

But since Woori has been transformed into a holding company with a stable stock price, the government will complete the stake sale by 2022.

The FSC noted Woori's stock price of 13,800 won ($12) will enable the government to retrieve 100 percent of the capital it injected into the financial company in 2001.

It spent 12.8 trillion won of taxpayers' money to save Woori in the aftermath of the Asian financial crisis.

So far, the government has recouped 87 percent of the capital injection.

Woori is trading at around 14,000 won per share, at which the state-run KDIC has said it can gain positive returns on its investment in the company.

Attracting more foreign institutional funds would enable Woori to be stable and stronger, making it less vulnerable to unexpected volatility, according to the holding company.

"The sales plan is in line with the government's earlier notification of what it would pursue after Woori became a holding company," a Woori spokesman said.

The Public Fund Oversight Committee said it unveiled the sales roadmap to increase transparency and reduce uncertainties regarding Woori.

The group is currently pursuing acquisitions of non-banking firms such as securities companies to bolster and diversify its business portfolio. It recently acquired Tongyang Asset Management, ABL Global Asset Management and Kukje Asset Trust, a privately held real estate management company.

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