KDB's Busan relocation plan rejected by Chairman Lee Dong-gull

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KDB's Busan relocation plan rejected by Chairman Lee Dong-gull

Published: 02 May. 2022, 19:11 Updated: 02 May. 2022, 19:44

Korea Development Bank Chairman Lee Dong-gull speaks to reporters at a press conference on May 2. [YONHAP]

Korea Development Bank (KDB) Chairman Lee Dong-gull is against President-elect Yoon Suk-yeol's campaign promise to move the bank's headquarters to Busan.

The relocation of the KDB "is being pushed without sufficient discussions," Lee said at a press conference on Monday. "The relocation definitely isn't a light matter, and it should not be forced speedily."

Yoon wants to move the bank's main office to Busan to support growth in areas outside of Seoul.

He will be inaugurated as president on May 10.

"There are opinions that the KDB relocation will generate between 2 trillion won [$1.6 billion] to 3 trillion won in value. But from a scholar's point of view, that is groundless. It is a claim that does not take into consideration massive minus effects that would bring to the nation's economy," Lee added.

Lee said he agrees with balanced development of different regions, but it should be sustainable. He added Busan, along with Ulsan and South Gyeongsang, known as major economic regions in Korea, should "strive to find its own competitiveness like finding new industries and managing insolvent companies."

At the press conference, Lee also said a new KDB chairman should be appointed in time for the new administration, reiterating his plan to step down after making the announcement last week.

Lee's term ends in September next year. He took the position in September 2017, the year Moon Jae-in became president.

"KDB is a bank and a policy organization," Lee said. "So I believe it would be reasonable for a new person that shares the political philosophy of the new administration should take on the role and be evaluated with the government together."

State-run KDB pushed restructuring of major companies during his term, including sales of Asiana Airlines, Daewoo Shipbuilding & Marine Engineering (DSME) and SsangYong Motor.

KDB "consistently pushed for the restructuring of insolvent companies under the principle of reasonable restructuring," Lee said. He said KDB restructured 11 companies under Moon government, including Kumho Tire, GM Korea and Daewoo E&C.

"Except for three cases, most restructuring of insolvent companies have been completed."

The Hyundai Heavy Industries (HHI) acquisition of DSME failed after the EU rejected the deal in January. SsangYong Motors is in search of new buyer after Edison failed to make a payment in its acquisition, while a deal to sell KDB Life to JC Partners was canceled last month.

BY JIN MIN-JI [[email protected]]