Confusion of LG Card Bondholders Mutual Management

There is a constant concern over whether or not LG Card’s plan for mutual management by its stockholders should be accepted as the date (January 7) of its joint management even as the deadline for written consent passes.

Amid all this, the finance supervision department is negotiating with Kook-min Bank for alteration of the terms of the agenda, increasing the possibility of a massive compromise.

According to the financial department, among 16 financial firms (10 banks and six insurance companies), and all of LG Card’s bondholders, five submitted the written consent by 5p.m., including Uri, San-up, Ki-up bank, LG fire insurance and Samsung Life.

Nevertheless, Kook-min, Shin-han bank and other 11 financial companies failed to present their consent papers.

Kook-min bank, the most powerful among the bondholders, called a continuous internal executive meeting. However, they failed to make a decision.

The finance inspection department and head bond bank, Uri bank, has postponed the due date of submitting the collaborative management written consent to 8 p.m., however, if needed, it can be delayed until the morning of January 8.

Yoon Yong-ro from the Financial Supervisory Commission stated, Our basic opinion is that Kook-min bank’s demand for San-up bank to increase its share of LG Card is absurd. However, if it helps to elevate the efficiency of mutual management, discussion about the alteration of the conditions can be continued.” He also added, “We are looking at all possibilities.”

On the other hand, the finance department and Uri bank have upgraded the LG investment stocks expected sale price from 200 billion to 350 billion.

According to this, if the mutual management agenda goes through, San-up bank will stay with bearing 500 billion, while the other nine banks will pay 1150 billion, 350 billion less than the original. After this, there investment will undergo stock conversion.

Keuk-In Bae bae2150@donga.com