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Kookmin Bank, the largest commercial
bank in Korea, plans to sell its 9 percent
stake to overseas investors, as it prepares
for increased competition from Citigroup
Inc.'s expansion in the nation.
In an effort to improve its employees'
qualification and team up with global partners
to expand its network abroad, Kookmin will
have talks with overseas banks and fund
managers starting from July this year, when
it is permitted to sell its treasury stock
worth 1.1 trillion won (U$ 927 milion) that
it acquired last year. Early in May 2004,
Citigroup purchased KoRam Bank, the six-largest
bank, for 3,1 trillion won, bringing a competitor
22 times larger in terms of market value
to Kookmin's door step, adding 225 locan
branches to its 12 Korean outlets.
It seems that the Bank could provide
an interesting investment portfolio for
foreign banks even as a minority shareholders,
now that it is a well structured bank. A
strategic investment would further promote
its efficiency and help its entrance into
new areas of financial services.
The Bank has an exclusive alliance with
ING Greop NV, a Dutch financial services
company, in the insurance business, and
hopes to get in more partner relationship
in asset management, corporate financing,
and credit card business. It made a joint
bid along with J.P. Morgan Chase & Co.
to acquire Korea Investment & Securities
Co. and Daehan Investment & Securities
Co. to expand its asset management business.
Kookmin now owns KB Investment Trust
Management Co., a joint asset manager with
ING investment, managing 10 trillion won
of assets, however, the Bank has no plan
to merge KB Investment if it buys one of
the target companies. ING is Kookmin's the
biggest shareholder with a 3.8 percent stake.
The purchase deal coincides with an offer
by Shinhan Financial Group Inc., Korea's
second largest financial services group,
to buy the remaining shares if doesn't own
in Chohung Bank, in the latest round of
takeovers in the baning sector.
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