Korea Investment & Securities Co. is considering acquiring KDB Daewoo Securities, the nation’s second-largest brokerage by capital, industry sources said Thursday.

The firm is weighing the bidding conditions and profitability of the acquisition, but has yet to declare participation in the bidding.

Both Korea Investment & Securities and Daewoo Securities are among the top three brokerages by turnover. If Korea Investment & Securities’ acquires KDB Daewoo, which has 4.2 trillion won ($3.7 billion) in capital and 33.9 trillion won in assets, the merged firm is expected to be the country’s largest securities firm.

The state-run Korea Development Bank, the largest shareholder of KDB Daewoo Securities, refused to confirm details on the list of bidders and priority criteria.

“On June 30, (Orix Private Equity Fund Korea) filed for the regulator’s approval to become the largest shareholder of Hyundai Securities,” a spokesperson of Korea Investment & Securities said.

“The review period will take about 60 days. We will not start the bidding until the Hyundai deal is completed.”

Korea Investment is known to be the latest prospective bidder of KDB Daewoo, after KB Financial Group, Shinhan Investment Corp. and Mirae Asset Securities.

Zhongxin Securities Co., a brokerage subsidiary of China’s state-run Citic Group, is reportedly also considering a bid.

By Chung Joo-won (joowonc@heraldcorp.com)