Suspended Korean savings banks to be sold

Korea’s deposit insurance agency will put most of the seven suspended savings banks up for sale. This is part of Korea's efforts to revamp the ailing financial segment.

In February, the country’s financial regulator Financial Services Commission suspended the savings banks, including top player Busan Savings Bank and its four affiliates, for six months due to their insufficient capital to meet depositors’ withdrawal demands.

“Most of the seven savings banks suspended in February are likely to be put up for sale as they were found to have negative capital,” Korea Deposit Insurance Corp. Chairman Lee Seung-woo said. “The KDIC will start to put the banks up for sale from end-April or next month.”

The sale is grounded on local law ordering savings banks with negative capital to go bankrupt or be sold, he said.