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RETAIL BANKING | Cesar Tordesillas, Korea
Published: 07 May 12
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Suspended Korean savings banks raided over alleged irregularities

Prosecutors have raided four savings banks to investigate alleged irregularities that led to their suspension a day earlier.

The head offices of Solomon Savings Bank, Mirae Savings Bank, Korea Savings Bank and Hanju Savings Bank, as well as the homes of each bank's executives, were raided.

The officialsd announced that more than 30 locations, including the banks' key branch offices in Seoul, are expected to be searched as part of the investigation.

South Korea's financial regulators suspended the banks' operations for their failure to meet the capital adequacy ratios recommended by the Bank for International Settlements standards.

The financial institutions are suspected of giving out illegal loans, while their top shareholders and management are suspected of embezzlement and bribery.

The raids are aimed at securing documents, computer hard drives and other evidence that could support the allegations, the officials said.

Major shareholders and executives of the suspended savings banks have already been banned from leaving the country.

 Later Monday, prosecutors said they sought an arrest warrant for Kim Chan-kyong, chief executive of Mirae Savings Bank, on suspicion he tried to sneak out of the country after embezzling 13 billion won or US$11.3 million in company funds. He was caught by the Coast Guard last Thursday while attempting to leave for China by boat.

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Tags: banking irregularities, Korean savings banks, suspended savings banks, bank raids, Solomon Savings Bank, Mirae Savings Bank, Korea Savings Bank,Hanju Savings Bank

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