South Korean regulator considers suing Kookmin Bank

Bank apologizes and promises punishing those involved in leaking of memo regarding a regulatory investigation.

South Korea's Financial Supervisory Service (FSS) alleged that Kookmin Bank, the flagship unit of KB Financial Group Inc., leaked the memo detailing questions and documents that had been requested by the FSS during its preliminary audit of the bank between 16-23 December 2009. 

A report in Trading Markets said the regulator suspects the bank leaked the records to people outside of the bank, possibly media groups.

Kookmin Bank could be slapped with fines of up to 10 million won (US$8,900) if proven guilty of interfering with the audit by leaking the information, according to local laws governing the banking industry.

The move came a day after FSS launched the regulatory audit into Kookmin Bank and its parent company on charges that the lender's investment in Kazakhstan's Bank Center Credit and issuance of $1 billion in covered bonds in May last year incurred massive losses for the bank.
 

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