The FSC will have the new firm take the lead role in corporate restructuring without government interruption. (image: Kobiz Media / Korea Bizwire)
SEOUL, Aug. 13 (Korea Bizwire) — South Korea’s top financial regulator will set up an entity that mainly deals with corporate restructuring later this year to put government-led workout programs in private hands, officials said Thursday.
In a report submitted to the parliament, the Financial Services Commission (FSC) said it has inked a memorandum of understanding (MOU) with 10 commercial and policy lenders to establish a company that specializes in corporate restructuring, according to the officials.
The state-run Korea Development Bank (KDB) and the Korea Export-Import Bank (Exim Bank) will participate in the project, with Shinhan Bank and Kookmin Bank to be major shareholders of the company.
“We’ve mapped out a broad plan to launch a restructuring firm as we finished picking up state-run and private banks that invest into the entity,” said an official from the FSC. “As the MOU was concluded, a task force will go into operation.”
He said the FSC is aiming to inaugurate the restructuring firm in mid-October.
As the Seoul government assigns major corporate workout projects to the KDB and the Exim Bank, policy lenders are suffering from massive losses stemming from the recent collapses of big businesses, including STX Group, Dongbu and Keangnam Enterprises.
The FSC will have the new firm take the lead role in corporate restructuring without government interruption.
It will help ailing companies to undergo restructuring before going through creditor-led workout programs, which may focus more on recovering bad debts rather than helping them stay afloat as long as possible.
(Yonhap)
