In an effort to maintain a neutral stance when choosing debt-ridden companies to rehabilitate, a new government-backed industrial revival body will not hire bank employees or retirees, officials said Friday.
The Industrial Revitalization Corp., to be launched Wednesday, will start operations May 8 with a workforce of about 100.
The IRC has unofficially decided on the appointments for senior posts, and none are from the banking sector, the officials said.
The move is intended to fend off possible criticism that the group favors banks by giving them a better price for their bad loans to troubled companies, which may be purchased by the IRC.
The IRC is meant to help rebuild heavily indebted firms that are still considered viable by accelerating bad-loan disposal in the nation's banking system.
But the new entity could also draw criticism if it finds it difficult to make a fair judgment in determining which indebted companies are still viable.
The IRC will consist of seven to 10 units under the supervision of Chief Operating Officer Kazuhiko Toyama. The units will spend a few months studying fiscal conditions and reconstruction plans by companies that file requests for support from the body.
The IRC has unofficially tapped executives of consulting firms, corporate rehabilitation funds and other financial-related companies as leaders in each unit, the officials said.
Employees of major banks currently on loan to the government to prepare for the launch of the IRC will return to their banks after the IRC takes off, they said.