Kakao on path to become largest shareholder of digital-only Kakao Bank
2019.10.18 12:00:18 2019.10.18 12:00:47
이미지 확대Korea Investment Holdings Co. said Thursday that it filed permission with the Financial Services Commission to hand over 29 percent stake in Kakao Bank to its fully-owned subsidiary Korea Value Asset Management Co. and instead retain 5 percent stake minus 1 share.
Once the financial holding company gets a nod from financial authorities, the digital-only bank’s second largest shareholder Kakao will expand its stake in the bank to 34 percent from current 18 percent. Earlier in July, the internet giant announced it would exercise an option over 16 percent in 50 percent held by Korea Investment Holdings in Kakao bank.
The exchange would make Kakao the country’s first non-financial entity to own majority stake in a lender under the special act that has made online banks exception in ownership cap. Also, it would resolve the issue for Korea Investment Holdings that needs to offload shares in the online-only bank to comply with the country’s financial holding company rule.
Under the Korean holding law, a financial holding company must own less than 5 percent in a non-subsidiary or more than 50 percent to command operations under its arm. A non-financial enterprise such as an internet company has been allowed to hold up to 34 percent stake in a digital-only bank with voting rights attached.
Market experts anticipate the procedure to go smoothly as authorities have already given a go-ahead to Kakao to become the largest shareholder of Kakao Bank in July.
Separately, Kakao Bank is readying for rights issue of 500 billion won ($423.4 million) to improve its Bank of International Settlement (BIS) capital adequacy ratio, which stood at 11.74 percent as of end of June and fell as low as the 10 percent in just three months due to spike in loan sales. The new stock issue is slated for Nov. 21.
By Chung Joo-won and Cho Jeehyun
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