Woori to boost non-banking business
Woori Financial Group is expected to boost its credit card operations after acquiring Lotte Card in a consortium with MBK Partners, according to industry officials, Thursday.
The Financial Services Commission said the consortium was eligible to push forward with the deal, allowing MBK Partners to hold a 60 percent stake in Lotte Card and Woori Bank 20 percent.
With the possibility of Woori Bank securing a controlling stake in Lotte after buying shares from the private equity fund, this is a step closer to achieving the corporate initiative to strengthen its non-banking business outlined by group Chairman Sohn Tae-seung last year.
He said at the bank’s shareholders’ meeting in December that he would push for mergers and acquisitions as part of efforts to better compete with four other financial groups.
The aggressive push was to boost the performance after Woori Bank returned to its holding company status in January, a mission accomplished under his leadership about four years after it abandoned it.
To land more customers, Woori is expected to intensify sales promotions at its bank branches to boost Lotte Card subscriptions, while users of both cards may be allowed to use mileage and points interchangeably at partner stores of both firms.
“While the merger will help boost corporate profit, nothing concrete has been discussed to push forward with the plan at this point,” a Woori official said.
The much-attainable merger between Woori Card and Lotte Card is unnerving the remaining six card issuers as it would mean a major shakeup in an industry long dominated by the big four — Shinhan, Samsung, KB Kookmin and Hyundai.