ING to sell off South Korean insurance arm for $2 billion

THE HAGUE (AFP) - Dutch banker ING is selling its South Korean life insurance arm ING Life Korea to private equity firm MBK Partners in a deal worth 1.24 billion euros (S$2.1 billion), it said on Monday.

MBK Partners is the biggest private equity business in South Korea.

"This transaction is a major step in the divestment of our Asian insurance and investment management activities," the Amsterdam-based ING said in a statement.

The deal is part of a drive by the company, the biggest bank in the Netherlands, to restructure its business as it sought to repay 10 billion euros in state aid, received in October 2008 during the financial crisis.

"Together with the scheduled payment of the next tranche ... to the Dutch state in November 2013, this will bring us closer to the end phase of the restructuring of our company," ING chief executive Jan Hommen said in the statement.

The banker has already paid back more than 10 billion euros and is expected to pay three more instalments each worth 1.1 billion euros by May 2015.

So far, ING has sold its insurance and investment businesses in Canada, Australia, New Zealand and Latin America and a large part of the same concerns in Asia under the restructuring, it said.

The global banker announced late last year that some 2,350 jobs are to be cut as part of the programme.

ING said the deal would allow it to retain a 10 per cent stake in ING Life Korea and the company, which employs 1,000 people and serves 1.3 million clients, will continue to operate under the ING brand for a maximum of five more years.

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