A Seoul court handed down a suspension on the ongoing merger talks between Hana Bank and Korea Exchange Bank.
The Seoul Central District Court issued an injunction on Wednesday, banning Hana Financial Group from pushing ahead with the merger until the end of June, partly acknowledging the KEB labor union’s protest.
“There were no compelling reasons for an early merger,” the court said in its ruling.
The court decision will stop the banking group from holding a shareholders’ meeting on the merger issue and will also suspend the financial authorities’ approval process.
Hana Financial had been seeking to obtain the Financial Services Commission’s preliminary approval within this month and launch an integrated bank as early as March.
Upon taking over KEB from buyout firm Lone Star back in 2012, the group signed an agreement with the KEB union to guarantee five years of managerial independence.
Citing financial reasons, however, the group decided on an earlier-than-expected merger, which triggered a fierce backlash from the union.
Hana suggested a number of compromises, including the promotion of the bank’s irregular workers to regular posts within a month after the merger, but failed to reach common ground.
