Woori Explores Cambodian Joint Venture

[WALL STREET JOURNAL]

SEOUL—South Korea's Woori Finance Holdings Co. is in discussions with the Cambodian government about jointly establishing a bank in the Southeast Asian country, Woori Finance officials said Wednesday, as the lender seeks to expand overseas to overcome slowing domestic market growth.

One of the officials, who declined to be named, said the discussions remain at an early stage. Current talks involve a joint capital injection of around $50 million into the bank venture, but the figure isn't set in stone and could change as negotiations evolve, he said.

The official wouldn't provide other details, including when an agreement with the Cambodian government may be finalized.

Domestic lenders such as Woori have been trying to expand overseas, primarily in emerging Asian countries, in order to develop new growth engines to overcome the limitations of the competitive domestic market. Southeast Asian countries such as Indonesia are frequently mentioned as an attractive market by banking industry executives, but the lenders' expansion efforts so far have yet to provide tangible results.

Woori Bank, the holding company's flagship banking unit, has said it is considering potential acquisitions or mergers in Southeast Asian countries like Cambodia and Vietnam.

Woori, which is 57%-owned by the South Korean government, is the largest South Korean financial holding company by assets.