KB Financial nominates Euh Yoon-dae as Chairman

Euh plans merging with Woori or acquiring KDB despite having little experience in banking.

KB Financial, parent of South Korea's top bank Kookmin, named a close ally of President Lee Myung-bak as its chairman, ending a nine-month vacancy in its top management and paving the way for the sector's consolidation.

KB, the country's second-largest banking group by market value, has been widely expected to lead a sector reshuffle as Korea Exchange Bank (KEB) is up for sale and the government plans to privatise Woori Finance Holdings.

KB said in a statement on Tuesday that Euh Yoon-dae, head of the Presidential Council on National Branding, was picked as chairman ahead of two other shortlisted candidates.

In reported comments, Euh said he would seek a merger with Woori and was also interested in acquiring Korea Development Bank (KDB) rather than tilt for KEB.

"I'm not very much interested in KEB as its profitability has weakened," Euh was quoted as saying by the Maeil Business Newspaper in its early Wednesday edition.

U.S. private equity fund Lone Star is selling a 51 percent stake in KEB worth $3.5 billion, but that auction has stalled as local bidders eye the rival attraction of a 57 percent stake in Woori to be sold by the government.

View the full story in Reuters.