KB Financial Group, the holding company of South Korean banking giant, Kookmin Bank, has replaced Bank of America-Merrill Lynch, Citigroup, Credit Suisse and JPMorgan, as foreign underwriters for its $2 billion share sale, reported Bloomberg.
KB Financial has roped in Goldman Sachs and Morgan Stanley for the mandate. Samsung Securities and Korea Investment & Securities were also hired to help manage the offering, spokesperson at the two banks said.
Disagreement over fees is being cited as the main reason behind the decision. According to the earlier agreement, KB Financial had to pay arrangers 0.6% of the capital raised and about 25% of average commissions, for underwriting rights offers. Hwang Young Key, Chairman of KB Financial, also wanted to use some of the money to issue more loans and finance possible acquisitions once the economy picks up.
KB Financial provides commercial and consumer banking services in South Korea. It offers asset management and life insurance through alliances with Netherlands-based ING Groep. The bank’s lending activities mainly entail residential mortgages, home equity loans, consumer loans, and corporate loans.
