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.