S.Korea to privatize No.2 bank rescued after 1997 financial crisis

South Korea's financial regulator said Monday that it planned to privatize the country's No.2 bank rescued with bailout funds after the 1997 financial crisis.

A controlling 30 percent stake in Woori Bank, held by the state fund manager, will be sold to a single buyer, with the remaining 26.97 percent stake in the No.2 lender to be offloaded to various financial investors, according to the Financial Services Commission (FSC).

The combined 56.97 percent stake was estimated at 5.4 trillion won (5.3 billion U.S. dollars) considering the price-to-book value ratio of 0.5.

The regulator planned to issue a public notice of sale in September before picking the most preferred bidder in early 2015.

The financial investors will be given a right to buy one more share per two shares later that they buy as part of efforts to boost the bidding process.

The regulator has tried to privatize the bank four times in the past, but all the efforts failed due to lack of interest among potential buyers.

The Woori Finance was established in 2001 by merging five troubled banks with 12.8 trillion won in bailout funds following the Asian financial crisis.

Among a total of 12 affiliates, six were sold to private investors, with the remaining six including Woori Bank and Woori Card set to be sold off.

Among the 12.8 trillion won bailout fund, 5.8 trillion won of the state fund was retrieved as of the end of May.