ING sells South Korean insurance arm for $1.6 billion

ING sells South Korean insurance arm for $1.6 billion

THE HAGUE - Dutch banker ING on Tuesday said it has completed the sale of its South Korean insurance arm ING Life Korea to private equity firm MBK partners in a deal worth around 1.27 billion euros (S$1.6 billion, US$1.73 billion).

But the Amsterdam-based banker reiterated that the deal resulted in a 1.0 billion-euro after-tax loss "of which 950 million euros were recorded in its 2013 third quarter results" on November 6.

ING posted an 84.7 per cent plunge in net profit for the third quarter on the back of the loss-making sale to MBK.

Profits spiralled from 659 million euros in 2012 to 101 million euros.

ING is now left with a 10 per cent indirect stake in ING Life Korea, equivalent to an amount of approximately 80 million euros in the company, which employs 1,000 people and serves 1.3 million clients.

The Netherlands' biggest bank announced the deal on August 26, which forms part ING's drive to restructure its business as it sought to finish repaying 10 billion euros in state aid, received in 2008 during the height of the financial crisis.

The banker has already paid back more than 11.5 billion euros on the state's loan received in October 2008 and is expected to pay two more instalments each worth 1.1 billion euros by May 2015, ING spokesman Raymond Vermeulen said.

So far, ING has sold business in Canada, Australia, New Zealand and Latin America and Asia under its restructuring.

MBK Partners has offices in Seoul, Tokyo, Shanghai and Hong Kong. It has around 20 companies its portfolio and more than US$8.0 billion in capital under management.

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