OK Financial Group has been selected as the preferred bidder to acquire Yebyul Insurance. With the move, OK Financial is expected to accelerate its push to build a comprehensive financial group, expanding into the insurance business after savings banks and capital financing.
The Korea Deposit Insurance Corporation (KDIC) said on the 10th that it had selected OK Next Co., Ltd. (OK Financial Group) as the preferred bidder in the re-announced public sale of Yebyul Insurance.
The re-announced public sale bidding for Yebyul Insurance, which ran through the 30th of last month, drew four participants: OK Financial Group, Korea Investment Holdings, Heungkuk Fire & Marine Insurance, and JC Flowers. The KDIC selected OK Financial as the preferred bidder after a preliminary review of statutory acquisition requirements, an assessment of the requested amount of financial support, and an evaluation of contract performance capability.
According to industry sources, OK Financial was highly rated overall for its sincerity in the acquisition of Yebyul Insurance, its financial stability, and its concrete roadmap for management normalization.
The KDIC plans to grant OK Financial an exclusive negotiation period and proceed with follow-up procedures such as sale negotiations and the signing of a share purchase agreement. If negotiations proceed smoothly, a share purchase agreement is expected to be signed during the third quarter and the sale to be completed within the year.
Yebyul Insurance is a bridge insurer established to transfer and wind down the insurance contracts of MG Non-Life Insurance, which was designated an insolvent financial institution in 2022. From 2023 through last year, it was put up for public sale a total of five times, all of which fell through. Even after Yebyul Insurance was established in September last year, the sale process continued, but it also failed at the main bidding in April this year, and this round has been regarded as effectively the last public sale procedure.
The financial industry is paying attention to OK Financial's past experience of acquiring insolvent financial institutions and normalizing them to top industry levels within a short period. OK Financial is recognized for its risk management capabilities, having acquired Yeju and Yenarae Savings Banks, then managed by the KDIC, in 2014 and launched them as the current OK Savings Bank, successfully establishing it among the industry's top two.
"We will fulfill our responsibilities to the very end so that we can safely protect the assets of 1.22 million policyholders and contribute to measures to normalize an insolvent financial institution," an OK Financial official said. "As non-life insurance is a new field for us, we will faithfully participate in the review and negotiation process going forward and pursue our leap to becoming a comprehensive financial group without a hitch."
