Seoul, Nov 25: LG Card, South Korea's largest credit card company, today said it would cut its workforce by one quarter as part of a drastic restructuring following a huge bailout. LG Card, an ailing unit of the country's second largest conglomerate LG group, said it would lay off 2,100 employees, or 25 per cent of its 8,400-strong workforce, by the end of this year.
It will also reduce its marketing costs by more than 30 per cent to 750 million dollars next year as part of cost-cutting efforts and put the priority on profitability, the company said.
The restructuring announcement came a day after eight creditor banks extended a USD 1.7 billion rescue package to pull LG Card back from the brink of bankruptcy.
Banks also agreed to roll over LG Card's debt payment for one year.
The firm resumed loan services yesterday afternoon after suspending operations since Saturday due to its liquidity crisis.
"We will do the utmost to restore financial market's confidence with self-rescue efforts," LG Card's president JS Park said. "We will normalise our company at the earliest possible time by focusing on strengthening profitability."
LG Card has 14 million clients, or one third of South Korea's total economically active population.
Bureau Report