HSBC Shops for Controlling Stake in KEB

Bank looks to strengthen presence in Korean economy
By Sam Gale Rosen,  Newser Staff
Posted Aug 20, 2007 3:29 PM CDT
The HSBC building is seen in the docklands, London, Monday July 30, 2007. HSBC Holdings PLC, HSBC Holdings PLC, Europe's largest bank by market value, reported Monday that its first-half earnings rose...   (Associated Press)

(Newser) – HSBC is in talks to buy a controlling stake in Korea Exchange Bank from the U.S. private equity group Lone Star. A local newspaper has reported that the deal would be worth $4.5 billion. HSBC wants to strengthen its presence in the Korean economy, and Lone Star has been looking to unload its share for years.

Lone Star's planned sale of KEB to the Kookmin bank fell through last year over allegations of wrongdoing at the time of the original acquisition. The purchase would help HBSC to compete with other large banks in South Korea. "HSBC’s operations have stalled in Korea, compared with other foreign rivals,” says an analyst.