Seoul to sell remaining stake in Woori Financial Group by 2022

The South Korean government plans to fully cash out of Woori Financial Group by selling the remaining 18.3 percent stake by 2022 regardless of the stock price.

The Financial Services Commission (FSC) said Tuesday it would divest the stake in two to three stages starting from 2020, offloading up to 10 percent in each tranche. This would complete the privatization of Woori, once a wholly-owned government entity formed through a merger of major lenders following the 1997 Asian financial crisis.

Shares of Woori Financial Group finished Tuesday 0.71 percent lower at 13,950 won ($12).

The public stake entity committee said it plans to complete the sale regardless of the stock price.

“The committee members are in agreement that it is important not to miss the timing. But we will reconsider the schedule if there is heavy volatility in the market,” said the committee.

The government owns 18.3 percent Woori Financial Group through the state-run Korea Deposit Insurance Corp. In 2017, it sold off parts of Woori Bank before it was converted to a holding entity to seven institutional investors, including IMM Private Equity, Tongyang Life Insurance Co., Hanwha Life Insurance Co., Kiwoom Securities Co., Korea Investment & Securities Co., Eugene Asset Management Co. and Mirae Asset Global Investments Co.

The 18.3-percent stake would be shed in the same competitive bid process as in the 2017 sale. Up to 5 percent of any remaining shares would be sold via a block deal.

Woori Financial Holdings was set up in 2001 as a holding entity after the government injected 12.8 trillion won to bail out five troubled financial companies in the wake of the Asian financial meltdown in 1997. Korea Deposit Insurance had then acquired 100 percent of Woori.

As of late May, the government had retrieved 11.1 trillion won, or 87.3 percent, of its bailout money.

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