Establishment of Banking Entities

The Banking Practice at Kim & Chang has assisted most of the major global banks in establishing, registering, licensing, reorganizing, closing, planning strategies, and conducting day-to-day operations of their subsidiaries, branches, joint ventures, affiliates, and representative offices in Korea. The Banking Practice has also actively advised clients in forming financial holding companies in Korea and reorganizing their structures under the Financial Holding Companies Act, and setting up internet banks, payment service providers, and other fintech entities in Korea.

Legal and Regulatory Advice

The banking industry is one of the most highly regulated industries in Korea, requiring compliance with various laws and regulations. The Banking Practice has unsurpassed expertise and experience in advising on legal, regulatory and compliance matters related to banking businesses in Korea, including audits and investigations by various regulators, such as the Ministry of Economy and Finance, the Financial Services Commission, the Financial Supervisory Service, and The Bank of Korea. The Banking Practice also keeps its clients up-to-date by monitoring and advising on amendments to laws, regulations, rules, guidelines, and model standards that affect the banking industry.

Transactions

The Banking Practice is a renowned leader in mergers and acquisitions, restructuring, project financing, international financing, trade financing, structured financing, foreign exchange transactions, derivatives transactions, securitization, loans, bond issuances, deposits, trusts, customer privacy, business outsourcing, and other major activities involving various banks, financial holding companies and other financial institutions in Korea. The Banking Practice regularly assists clients in designing, structuring, introducing and updating cutting-edge financial products in Korea. 

The Banking Practice provides its banking M&A clients with comprehensive legal services in all stages throughout the transaction, from targeting potential opportunities and due diligence to execution of transaction documents and closing the deal. Its efficient organization of professionals with the relevant experience and expertise for each transaction enables Kim & Chang to provide clients with services of the highest quality. It also works closely with other specialized teams at the firm that focus on tax, restructuring, dispute resolution, securities regulation, and fair trade and antitrust matters with an aim to deliver the best results in the most cost effective manner.

Shareholder Qualification Assessment and Shareholding Report

A bank is required to periodically submit a set of documents to the Financial Services Commission for the commission to assess the qualification of its shareholders who hold shares above a prescribed limit. A shareholder of a bank can also be required to report the status of its shareholding in the bank to the regulators. The Banking Practice assists in the preparation and submission of such regulatory documents.

Litigation and Dispute Resolution

Kim & Chang is well-renowned for its extensive experience in representing financial institutions in various types of disputes, including not only conventional lawsuits, but also alternative dispute resolution (e.g., arbitration, mediation) and administrative appeals as well. With a comprehensive understanding of the banking industry and industry knowledge and insight into client businesses, the Banking Practice collaborates with the firm’s Litigation Practice and International Arbitration & Cross-Border Litigation Practice to help financial institutions navigate through complex disputes. The Banking Practice has a solid track record for resolving complex disputes that clients face, regardless of whether they are against private parties or regulatory authorities.

Regulatory Audits and Investigations

The Banking Practice assists banks in dealing with various audits and investigations conducted by regulators, such as the Financial Supervisory Service and The Bank of Korea. It helps ensure that the audits and investigations proceed in compliance with relevant laws and regulations and that its clients’ positions and views are presented to the regulators effectively. If a client faces regulatory sanction, the Banking Practice advises the client on the sanction process and helps the client with developing defense strategies. By utilizing its vast experience in handling such investigations, the Banking Practice also offers a diagnostic assessment of its clients’ potential issues and concerns through mock audits and compliance reviews before a regulatory audit or investigation is launched, and offers preemptive solutions for mitigating the risk in advance.

Advice Relating to Policy and Legal Analysis

• Participated in Task Forces with various government agencies formed to cover the amendment of relevant laws
• Assisted clients in applying for no-action letters and regulatory rulings
• Reviewed general terms and conditions of banks
• Participated in establishing regulations for OTC derivatives CCP
• Rehypothecation of KTB (Korea Treasury Bond)
• Assisted clients in the establishment of internet banks in Korea
• Represented banks in covered bond issuances
• Conducted check of anti-money laundering law compliance
• Assisted clients in obtaining approvals for shareholders of banks holding in excess of prescribed limit
• Reviewed Basel III requirements on common shares, etc.

Establishment of Banks and Financial Holding Companies

• Advised on the establishment of Standard Chartered Korea
• Advised on the establishment of Citigroup Korea
• Advised on the establishment of KB Financial Group
• Advised on the establishment of Shinhan Financial Group
• Advised on the establishment of JB Financial Group
• Advised on the establishment of NongHyup Financial Group
• Advised on the conversion of Daegu Bank into a financial holding company
• Advised on the establishment of BS Financial Group and relevant license issues (comprehensive stock transfer)
• Advised on the establishment of KDB Financial Group through stock split and stock swap of Korea Development Bank
• Advised on the establishment of K Bank, one of the first internet banks in Korea
• Advised on the establishment of Toss Bank, a new internet bank
• Advised on the establishment of Woori Financial Group through comprehensive stock transfer

M&A of Financial Institutions

• KDIC (Korea Deposit Insurance Corporation)’s sale of Woori Bank
• KB Financial Group’s acquisition of LIG Insurance
• Closure of part of domestic business units of a foreign bank
• Korea Development Bank’s acquisition of KDB Financial Group and Korea Finance Corporation
• Hana Financial Group’s equity acquisition of Korea Exchange Bank
• KB Financial Group’s P&A acquisition of Jeil Savings Bank
• DBG Financial Group’s 100% equity acquisition of Metro Asia Capital
• MBK Partner’s tender offer of HK Savings Bank shares
• KB Financial Group’s acquisition of Hyundai Securities
• Yuanta Commercial Bank’s acquisition of Hanshin Savings Bank
• Woori Financial Group’s acquisition of Aju Capital/Aju Savings Bank and Kukje Asset Trust
• KB Financial Group’s acquisition of Prudential Life Insurance
   

Licensing under Capital Markets Act

• OTC derivatives investment trading business license for the Seoul branch of OCBC
• KTB (Korea Treasury Bond)/MSB (Monetary Stabilization Bond) investment trading business license for the Seoul branch of Goldman Sachs International Bank
• KTB trading license for Societe Generale’s Seoul branch
• Investment trading license for treasury securities and non-equity based OTC derivatives for ING Bank’s Seoul branch
• Investment brokerage license for non-equity based OTC derivatives for Credit Suisse’s Seoul branch

Regulatory Audits and Investigations

• Advised on private equity fund-related audits and sanctions
• Advised on ELS-related audits
• Advised on audits related to administrative penalties under the Act on the Protection of Financial Consumers
• Advised on audits related to administrative penalties for violations of the Banking Act
• Advised on audits related to the obligation to establish internal control standards under the Act on Corporate Governance of Financial Companies

Bank Litigations

• Represented multiple banks in foreign currency hedging product (KIKO) related litigations and kun-mortgage expenses litigations
• Represented KB Kookmin Bank in the litigation over corporate income tax return
• Represented major banks in private equity fund-related litigations
• Represented Woori Bank/Hana Bank in the administrative lawsuit over DLS and DLF

Establishment of Korean Branch or Office by Foreign Financial Institutions

• Bank of Communications’ Seoul branch
• Morgan Stanley Bank International Ltd.’s Seoul branch
• Goldman Sachs International Bank’s Seoul branch
• Landesbank Baden-Württemberg’s Seoul branch
• Royal Bank of Scotland’s Seoul branch
• Macquarie Bank Limited’s Seoul branch
• BBVA Bank’s Seoul branch
• BDO Unibank’s Seoul representative office
• Northern Trust Company’s Seoul representative office
• China Everbright Bank’s Seoul branch