Mirae chairman found with pricey art collection

Mirae Savings Bank Chairman Kim Chan-kyong, who was arrested and charged with embezzlement and breach of trust early this month, was found with several costly pieces of art from famous artists, including Pablo Picasso and Alberto Giacometti, according to prosecution sources on Sunday.

Investigators are currently tracking down the whereabouts of the paintings and sculptures and are looking into whether the art was given as collateral to receive loans from Solomon Savings Bank, one of the other four suspended savings banks being investigated for alleged financial irregularities, along with Mirae.

According to the central investigation team of the Supreme Prosecutors’ Office and financial authorities, Chairman Kim purchased a total of nine masterpieces including Picasso’s “Le Peintre [The Painter]” painting and Giacometti’s “Untitled” sculpture.

The total value of the art owned by Kim is estimated to be worth dozens of billions of won. The art, however, has not been recorded as part of Mirae or Solomon’s assets.

Prosecutors suspect that the art is currently being stored at an unknown location.

Prosecutors suspect that Chairman Kim received illegal loans of around 45 billion won ($38 million) from the Solomon Savings Bank using the nine works of art and his younger brother’s building as collateral.

Prosecutors previously found out that Lim Suk, chairman of Solomon Savings Bank, allegedly received 1 billion won worth of goods, including high-priced artwork from Chairman Kim beginning in August of last year, in return for giving illegal loans to the Mirae Savings Bank and helping the bank keep from becoming suspended.

The Korea Deposit Insurance Corporation also found out previously that a separate number of around 20 paintings - each worth more than ten million won - were discovered in the asset inventory of Solomon Savings Bank.

According to prosecution sources, Chairman Kim is allegedly known to have more stashed art beyond the nine masterpieces.

“Chairman Kim opened an art gallery on the second floor of the Mirae Savings Bank headquarters and boasted about his art to the bank’s VIP customers,” said an official from the prosecution office.

Meanwhile, according to the prosecution, in September of last year Chairman Kim received a capital increase of 14.5 billion won from Hana Capital, using five paintings, including Park Soo-keun’s “Women on Roadside” and Cy Twombly’s “Bolsena” as collateral. The art industry estimates the total value of the five paintings to be worth around 20 billion won.

According to sources, in November, last year, Hana Capital sold “Bolsena” for around 7.3 billion won and Park’s “Mother, child and two women” for 1.12 billion won.

The two paintings were originally owned by Gallery Seomi, which received a 28.5 billion won loan using the two paintings as collateral from Mirae Savings Bank.

By Jung Won-yeob [angie@joongang.co.kr]