BOK transfers trillions ... by road

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BOK transfers trillions ... by road


A bird-eye view of the Bank of Korea in central Seoul, left. The central bank will temporarily relocate in June to a Samsung-owned building, around 1 kilometer away, right. [JOONGANG ILBO]

Imagine more than a thousand trucks, each loaded with billions of won, running through the streets of central Seoul. It could be the storyline of a Hollywood blockbuster but the surreal scene is set to unfold next June.

The Bank of Korea (BOK) announced on Friday that it will temporarily move into Samsung’s historic building in Jung District, central Seoul, which formerly served as the group headquarters, while the bank’s current headquarters undergoes remodeling. The central bank will return to the original location in 2020.

About 10 trillion won ($8.39 billion) in banknotes - new and yet-to-be issued - are stored at the central bank’s underground vault. However, and the bank will not move the huge amount to its temporary office, which is only about 1 kilometer (0.6 miles) away. Instead, the bank will disperse the cash across several branches within the Seoul Metropolitan area including one in southern Seoul.

“We were debating between Samsung’s former main building and Samsung Fire & Marine building, both located in central Seoul, but we chose the former due to security concerns,” said a BOK spokesman on Friday.

Samsung Fire & Marine building is closer to the subway station but the BOK found the former Samsung headquarters more attractive due to the size and safety. The official amount of rent has not been announced yet, and it its expected that the BOK and Samsung will start negotiations soon.

Currently, Samsung Life Insurance and Samsung Securities are using building the BOK has chosen, but Samsung Group is planning to relocate the two financial arms to its headquarters in Seocho District, in southern Seoul.

The BOK was established in June 1950, only few weeks before the Korean War broke out, and has been operating in Namdaemun area in central Seoul ever since. During the war, it temporarily moved its headquarters to Busan.

“There are constructions under way near the BOK for high-rise hotels and we decided to remodel our building as well to step up security functions last year,” said the BOK spokesman. “We plan to move back to Namdaemun before June, 2020, which will be the 70th anniversary of the bank.”

There is no gold stored in the BOK’s current headquarters. Some 1,070 kilograms (2,358 pounds) of gold that had been kept in the underground vault was moved to Busan two days after the outbreak of Korean War. During the war, the North Korean Army took over the BOK building and 223 kilograms of gold fell into their hands.

The BOK asked the U.S central bank to secure its gold during the war, which was later returned. The BOK moved gold to its Daegu branch, which had a special safe, but started to move it to the U.K central bank in 1980s. By 2004, all of the gold that the BOK held was moved to the U.K bank.

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