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Kwangwoo Park, a Professor of KAIST College of Business, said, “a Mutu..2013-09-30Hit:5220

Kwangwoo Park, a Professor of KAIST College of Business, said, “a Mutual Savings Bank Should Reduce the Shareholding Ratio of Major Shareholders.”

(Reporter Yeseul Lee) Some people argue that the ownership structure of a mutual savings bank should be changed because the shareholding ratio of major shareholders is too high.

Kwangwoo Park, a professor of KAIST Graduate School of Finance and Accounting, said in ‘an open forum on sound development direction for mutual savings banks at YWCA Cathedral in Myeng-dong Jung-gu Seoul on August 30th, “A mutual savings bank should reduce the shareholding ratio of major shareholders to prevent illegal activities.”

Professor Park also said, “Current ownership concentration cannot prevent illegal activities of major shareholders, so the shareholding ratio of major shareholders should be limited to less than 50 per cent through a mutual benefit association which promotes public interests.”

The attempt is necessary to improve company value, as well as to seek private benefits of major shareholders.

He explained, “According to finance theory or empirical research, high ownership concentration reduces the value of a company. An appropriate level is around 50 per cent.”

Keon-beom Lee, a professor of Hanshin University, indicated that the point is a lack of systems to stop major shareholders from abusing their power.

Professor Lee stressed, “The insolvent mutual savings banks are places where major shareholders seek private benefits when management is in trouble or the business environment has worsened.

He also said, “A new business model of mutual savings banks, diversified and dispersed shareholders, and a high intensity supervision program are necessary.”



Contact : Lee, Sohyun ( sohyun.c.lee@kaist.ac.kr )