Yonhap | 19 novembre 2025

S. Korea wins annulment in investor dispute over Lone Star’s sale of local bank

by Kim Seung-yeon

An international arbitration body for investor–state dispute settlement has ruled in favor of South Korea in its challenge to the award for private equity fund Lone Star over its 2012 sale of a local bank, Prime Minister Kim Min-seok said Tuesday.

The International Center for Settlement of Investment Disputes (ICSID)’s annulment committee has nullified the earlier decision ordering South Korea to pay Lone Star US$216.5 million in compensation plus interest, Kim said in a briefing.

Prime Minister Kim Min-seok (C) speaks during a press briefing on the annulment of the Lone Star investor-state dispute settlement case, at the central government complex in Seoul on Nov. 18, 2025. (Yonhap)

"The government’s compensation liability, which was roughly 400 billion won based on the current exchange rate, has been retroactively extinguished," Kim said. "I believe that, thanks to our people’s support, the country’s fortune is moving in a positive direction."

Under the latest ruling, Lone Star is required to pay South Korea’s legal costs incurred during the proceedings — about 7.3 billion won (US$4.98 million) — within 30 days, Kim added.

South Korea had appealed the ICSID’s 2022 ruling to pay the compensation to Lone Star, after the private equity fund filed a suit in 2012 claiming that the South Korean government interfered with the sale of Korea Exchange Bank (KEB), incurring $4.67 billion in losses.

Lone Star acquired KEB in 2003 for 1.38 trillion won and later sold it off to a major South Korean banking firm, Hana Financial Group, for 3.92 trillion won in 2012.

Lone Star argued that government interference caused the firm to miss the chance to sell KEB at a higher price and that it ended up being forced to sell it at a reduced price.

In July 2023, Lone Star filed a suit to annul the 2022 ruling, claiming that the compensation was not sufficient. Seoul also lodged a petition to cancel the award and suspend the decision in September of that year, citing the tribunal’s overreach and violations of procedural rules.