KEB unit suspends cash services

KEB unit suspends cash services

SEOUL: Korea Exchange Bank (KEB) said Monday its credit card business unit had suspended its cash advance services due to a cash shortage in a widening crisis over South Korea's credit card industry.

It is unclear when KEB Credit Service will be able to resume the services which were suspended around 2:00 pm (12 a.m. Jakarta time), according to KEB.

"We could not provide further cash to the unit as 350 billion won (US$290 million) of ceiling set for the unit has already been used up," a bank spokesman said.

The official said the card unit was also having difficulty getting fresh loans from other financial institutions because of its liquidity problems and ongoing strikes by the labor union to protest the unit's planned merger with the parent bank.

KEB, the sixth-largest lender in South Korea, was taken over in October by Lone Star, a U.S. investment fund which paid 1.38 trillion won for a 51 percent stake from the government. -- AFP