Permission Of Conglomerates’ Banking Business In The Expense Of Manufacturing Area

Jin, Nyum, vice prime minister and minister of Finance and Economy, and other senior officials started to make public that government is willing to additionally loosen various business restrictions, including the revision of designating 30 conglomerates.

Vice-prime minister Jin said in an interview with Yonhap press on July 27, ``If companies are actively cooperating in order to adopt a system for guaranteeing responsible management, including group litigation, government is willing to take additional steps to loosen the regulations, such as reduction of 30 conglomerate designations and its requirement changes. If a company gives up its manufacturing business area and invests more than 75 percent of its own assets into banking business, the ownership of the banks will be allowed even to a conglomerate.``

Kim, Jinpyo, vice minister of Finance and Economy ministry, said in a TV program, ``The designation system of 30 conglomerates has some problems in that it is executed based on just one criterion (i.e. assets). This can be modified in conjunction with the group litigation, which will be effective before the end of this year.

Jin also said,`` During the fourth quarter, a program, which allows for the employment of ex-businessmen or ex-bankers as management consultant or board member in venture business and general companies, will be launched.``, emphasizing, `` Large scale economic boom, which accompanies massive finance deficit, may damage the foundations of the economy . Instead, we will encourage internal demands, focusing on restructuring without damaging the consumer price and integral finance.``

sanjuck@donga.com