KB Financial steps up its restructuring efforts

The group’s spinning-off of its credit card unit aimed to improve competitiveness of its flagship banking unit.

KB Financial Group is expediting efforts to reshape its credit card unit, which will be spun off from Kookmin Bank next year.

The separation is key enterprise of chairman Euh Yoon-dae to improve the profitability of the struggling banking titan. KB Card is likely to be launched in the first quarter of 2011 after a regulatory endorsement.

The financial group had planned to move about 1,300 employees to KB Card.

A group spokesman said the number of applicants for movement was 1,670, far more than earlier expected. They include 1,200 full-time and 470 contract workers.

“Employees at KB Card could enjoy higher bonuses based on their performance, compared to banking staff,” the spokesman said.

To appease concerns about the new startup’s future, the group also promised to allow them to come back to the banking unit in three years.

View the full story in Korea Herald.