S. Korea decides to reorganize some policy banks.

SEOUL, July 6 (Yonhap) -- South Korea unveiled its preliminary decision Friday to reorganize some of the country's state-run banks, a move aimed at eliminating conflicting operations with private lenders and boosting their role as policy banks. The Ministry of Finance and Economy's decision will apply to the Korea Development Bank (KDB), the Industrial Bank of Korea and the Export-Import Bank of Korea, the country's three main policy banks. The final decision will be made in August. The decision calls for the KDB to reduce commercial operations that conflict with the market, including its operation of private equity funds and engagement in mergers and acquisitions. Such commercial operations will be transferred to its two units, Daewoo Securities Co. and KDB Asset Management Co., to form an investment bank that sells securities, insurance and bank products. The ministry plans to create the bank in 2009 when the country's barrier-reducing Capital Market Consolidation Act takes effect. The ministry said it plans to decide whether to sell Daewoo Securities after the new investment bank's operations are settled. The government had originally planned to sell off its stake in Daewoo Securities, which was acquired by the KDB in 2000. The KDB has a 39.09 percent stake in the brokerage. Cho Won-dong, Deputy Finance Minister, ...