SEOUL (Reuters) - South Korea's plans for capital injections into state-owned banks as part of the ongoing overhaul of the country's shipping and shipbuilding industry are pre-emptive, the vice finance minister said on Monday.
"We are looking at pre-emptive measures for structural reform as the situation is moving along a path that is slightly worse than we expected late last year," said Vice Minister Choi Sang-mok in a monthly briefing.
"Whatever we do to inject capital into state-run banks involved in the structural overhaul process is going to involve taxpayer money. So we have to be very careful."
South Korean authorities are seeking to increase the capital buffer on two state-run banks involved in an overhaul of shipping and shipbuilding companies strapped for cash.
Choi added "painstaking" measures would have to be taken by companies that are being reformed before the government acts.
"After then we will be able to talk about the size of the capital we're going to give the banks and how," he said.
No consensus has been reached yet on recent government and presidential remarks on the central bank possibly engaging in quantitative easing to provide capital for the two state-run banks, Korea Development Bank and the Export-Import Bank of Korea, Choi added.
The vice finance minister will chair the first task force meeting on Wednesday regarding the issue, which will be attended by officials from the government, financial regulator, central bank and other related bodies.