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RETAIL BANKING | Cesar Tordesillas, Korea
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Woori union opposes privitization

The labor union of Woori vowed to launch a general strike if the government continues plans to sell it to another banking group.

The government’s plan to privatize Woori is likely to result in an acquisition by or a merger with a rival bank, creating a “mega bank” which would pursue high-risk business and limit consumers’ choice of financial services, the union said in a press conference.

The Public Fund Oversight Committee, which handles state asset sales, said a week ago it will receive preliminary bids for the 56.97 percent government stake until July 27. The sale plan comes after financial authorities failed to attract a preferred bidder for Woori Financial several times between 2010 and 2011.

The state-run Korea Deposit Insurance Corp. owns the stake that is valued at about 6.3 trillion won or $5.56 billion.

The union demanded that the government offer about 30 percent of the stocks to the general public at discounted prices, about five percent to Woori Financial employees and sell the remaining 22 percent in block deals through competitive bidding.

The union also insisted that Woori Financial’s subsidiaries Kyongnam Bank and Kwangju Bank should be sold off separately to the local people as they are key parts of the regional economy.

“Instead of a forced privatization using foreign or other banks’ capital, we demand offering stocks to the general public so the taxpayers’ money can be redistributed to the people,” Woori Bank union chief Lim Hyuk said.

“The rest should be sold to Woori Financial employees or in block deals through competitive bidding.”

While KB Financial Group is known as one of the most likely bidders, the union chief of KB Kookmin Bank union said Kookmin’s staff were against a merger.

“A mega bank is not right for the Korean financial industry. It will only harm bank employees,” he said.

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