South Korea’s Hana Financial Group is set to merge its two banking units, Hana Bank and Korea Exchange Bank (KEB), after receiving the consent from the KEB labour union.
The combined entity, which will be launched before October 2015, is said to become South Korea’s largest lender by assets. The combined assets of the two units stood at KRW290 trillion ($256.2bn) as of 31 March 2015.
Hana Financial has now filed a request with the Financial Services Commission (FSC), seeking the go-ahead for the merger.
The deal is expected to get the preliminary nod of the regulation in 60 days, and the official sanction in another 30 days.
Hana Financial had been proposing the merger following its acquisition of KEB from US buyout fund Lone Star in 2012.
However, it failed in its efforts owing to opposition from KEB labor unions, which have been demanding independent management for five years.
A Seoul court issued an injunction against Hana Financial in February, restricting it from conducting any merger processes.
However, an appellate court ruled in favour of the firm last month, allowing the firm to resume talks with the labor union.
Hana Financial in a filing said: "(We) reached an agreement on the principle of the integration, name of the united bank, the procedure and synergy sharing of the integration, and guarantee of job security. We also decided to implement the agreement with sincerity based on the principle of good faith."