The board of Woori Bank approved a plan to convert the bank into a holding company, pushing up its shares on Wednesday.
An announcement released late Tuesday said the country’s fourth largest bank would overhaul its structure to become an integrated financial service company with diverse non-banking affiliates.
The holding company will have six affiliates: Woori Bank, Woori Credit Information, Woori Private Equity Asset Management, Woori FIS, Woori Finance Research Institute and Woori Fund Service.
Woori Card and Woori Investment Bank will remain subsidiaries of the banking unit and may later be turned into separate affiliates under the new holding company, according to Woori Bank in a statement.
A shareholder meeting will be held by the end of this year to approve the changes.
“The plan will help boost competitiveness for Woori affiliates,” a source at Woori Bank said, “We will swiftly carry out the procedure.”
Analysts said the change in corporate structure could increase the maximum amount of investment allowed by regulators to around 8 trillion won ($7.2 billion).
Sohn Tae-seung, CEO of Woori Bank, has reiterated that the company is already looking to acquire non-banking companies like asset management and securities companies.
Earlier this month, a local media outlet reported that Woori Bank plans to acquire Kyobo Securities, but Woori said that nothing has been decided.
Samsung Securities was also among the potential targets cited by different reports, though Woori declined to confirm that.
Investors welcomed the board’s decision on Wednesday, and shares of Woori Bank rose 5.88 percent to close at 17,100 won.
“The decision to put the six Woori units under the holding company and keep Woori Card and Woori Investment Bank under Woori Bank will likely serve the interests of shareholders,” said Baek Doo-san, an analyst at Korea Investment & Securities.
The plan to turn Woori Bank into a holding company accelerated after the Financial Services Commission, the country’s top financial regulator, said it would sell the government’s stake in the bank once the transformation is complete.
The government holds 18.4 percent of Woori Bank through the state-owned Korea Deposit Insurance Corporation.
