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Senior S. Korea presidential official quits

SEOUL, September 16, 2011 (AFP) - A senior South Korean presidential official has resigned over a probe by state prosecutors into corruption involving a troubled savings bank, the president's office said Friday.

Senior presidential spokesman Kim Du-Woo submitted his resignation to President Lee Myung-Bak, Lee's office said.

The move came after prosecutors decided to summon Kim over allegations that he was lobbied by Park Tae-Gyu.

The lobbyist is suspected of taking more than one billion won (US$900,000) from Busan Savings Bank with promises that he would lobby senior officials and politicians so that the lender could avoid a suspension of operations.

However the bank was suspended in February after runs developed as customers rushed to withdraw their money.

Kim denied involvement in the scandal, according to a presidential spokesman.

Eight savings banks have been suspended so far this year because of inadequate liquidity after financing on soured real-estate projects swelled their bad debts.

The suspensions did not threaten the overall financial sector but fuelled anger among small depositors, especially after claims that wealthy clients were tipped off in advance about the shutdowns so they could withdraw funds.


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