Japanese Money-lending Company to Be Listed in Kosdaq

Japanese financial corporations, which are shaking domestic private loans market in 3 year’s inroad into Korea, are making entry into Kosdaq creating a stir in the process of inspection for enroll.

Park Jin-Wook executive of A&O International, which is a leading company among Japanese lending firms, announced on the 21st, "since the foundation of the company in July 1998, sales and profits are increasing vastly every year, and we have no reasons for being disqualified for Kosdaq enrollment. We will promote to enter Kosdaq after completing external audit in March, as we agreed with Japanese majority shareholder on the enrollment in Kosdaq."

Lee Deok-Soo executive of Progress, founded in 1999, said, "we forecasted the enrollment in Kospi after entering Kosdaq as early as beginning lending business in Korea. With greater performance than we expected, we are making an entry into Kosdaq."

Japanese lending firms expect that they could expand business after the enrollment in Kosdaq, as they could enlarge the capital, and issue corporate security and commercial paper (CP).

10 lending companies along with Takefuji, which is No. 1 company out of 20,000 firms in Japan, are listed, and Takefuji is listed in London Stock Exchange. The stock price of major lending companies is as high as that of Sony Electronics.

These two companies meet the requirements for being listed in Kosdaq such as △ equity capital over 10 billion won, △ total assets over 50 billion won, △ debt ratio under 100 percent or the average ratio of the same sort of companies. There are no reasons of disqualification in the quality requirements demanding financial stability and transparency of accounts. The tax-deduced profits of A&O International was 30 billion won, and that of Progress 20 billion won last year.

To such movement of lending firms, Kosdaq Committee officially shows the principle, saying, "there are examples of lending firms that are listed in Japanese Stock Exchange, and every company that meets the requirements of Kosdaq can be listed." But there came up internal opinions saying, "it would be hard for lending companies to pass the inspection for listing, since there is a provision in the regulation for requirements that the characteristic of the business should be considered, and lending business actually is regarded as usury. " Hence, when the lending companies’ promotion for Kosdaq enrollment comes up to the surface, stirs are anticipated."

Lee Deok-Soo executive of Progress said, "we forecasted sentimental apposition. Therefore, we will transform ourselves into legal moneylender after the registration law for lending business passing in the Congress, and when friendly relations between Korea and Japan is promoted with Korea-Japan World Cup games, we will get our ground as a financial company under legal system by succeeding in listing in Kosdaq."

Byong-Ki Lee eye@donga.com