Financial holding companies now legal

Both the ruling and opposition parties agreed July 24 that the government will sell off its ownership in stocks of domestic banks, such as Hanvit Bank and Chohung Bank, within four years if the government is on course to becoming the ruling shareholder of the financial holding company.

The National Assembly`s Finance and Economy Committee passed the Financial Holding Company Law and its additional rules with the participation of only members of the ruling Millennium Democratic Party and the United Liberal Democrats.

With the new law, there is a high possibility that the government will sell off its holdings of bank stocks, estimated to be worth about 10 trillion won, staring next year at the earliest.

With regard to the timing for the sale of bank stocks, the government has agreed with the International Monetary Fund to dispose of the stocks from around the second half of 2002 when relevant banks` operations are expected to normalize.