October 27, 1997
— Daeheung Group Headquarters, Mapo
In the spacious chairman's office, Chairman Park, the chairman, sat in the center of a leather sofa, flanked by his eldest son, Park Jin-hyung, president of Daeheung Textile, and Secretary Gil Sung-ho. They were engaged in conversation.
"What's the exchange rate today?"
Chairman Park asked, resting his arm on the sofa, and Secretary Gil, meeting his gaze, answered immediately.
"It's been jumping all morning. When I came in, it had risen to 1,489 won."
"Wow... 1,489 won. Who could have imagined the dollar would soar like this? It was only 890 won at the start of the year."
Shaking his head, Chairman Park spoke, and Park Jin-hyung gave a slight smile.
"Seok-won knew this was coming, didn't he?"
"Huh? Haha! Yes, that's right."
Chairman Park burst out laughing.
While the exchange rate was soaring and liquidity drying up, leaving everyone on edge, they could still speak so calmly thanks to the dollars they had stashed away.
"How much has the dollar risen in just a few months?"
"About a 67% jump."
Upon hearing this, Chairman Park exhaled deeply.
"If someone had foreign currency loans, their interest and principal would have ballooned by that much overnight. It literally turns into dollar debt."
It was a common expression for borrowing money with expensive interest: calling it "dollar debt." He was making a reference to that.
"Exactly."
"Nowadays, they say you can't even get dollars at banks or even at Myeong-dong money changers, even if you pay a premium."
Hearing this, Chairman Park nodded slightly.
"Of course. When the exchange rate spikes wildly overnight like this, everyone just holds tight. Who would sell?"
"That's true."
Secretary Gil glanced at Chairman Park cautiously before continuing.
"Thanks to our prior preparations, we don't have liquidity issues, but with the economy frozen by the fallout from the foreign exchange crisis, our main affiliate, the department store, is seeing a sharp drop in sales."
"They're running autumn sales and special promotions, but sales still aren't good, right?"
"Yes. Sales are down more than 30% compared to last year, and they don't expect much better for the year-end season."
The department store's biggest sales season was the Christmas year-end period.
At the news that even the crucial year-end sales would be disappointing, Chairman Park's brow furrowed.
Normally, he would have snapped in anger, but not this time.
He understood it wasn't the management's fault — the foreign exchange crisis had forced customers to tighten their wallets.
In reality, everyone was struggling, so it was impossible for Mido Department Store to be thriving alone.
"Ugh."
Chairman Park sighed deeply, a troubled expression etched across his face.
"With the economy like this, there's nothing we can do."
At that, Park Jin-hyung, his eldest son, cautiously interjected.
"For now, it would be a relief just to break even without losses."
"That's true. Compared to other department stores going bankrupt one after another, we're still in a better position."
"Right. There are rumors that NewCore Group, which owns NewCore Department Store, will soon file for court protection after failing to overcome their liquidity crisis," Secretary Gil Sung-ho added.
Hearing this, Chairman Park furrowed his brow.
"They recklessly expanded their branches for years and ended up like this."
"They tried to aggressively capture market share ahead of foreign discount giants like Costco and Carrefour entering the domestic market. That backfired," said Park Jin-hyung.
Chairman Park's expression turned bitter.
"The chaebol-backed department stores Lotte and Utopia are squeezing from above, and the foreign discount giants are aggressively moving up from below. That made them anxious."
He himself had felt that pressure not long ago, so he couldn't regard it as someone else's problem.
If it weren't for Seok-won's advice, Daeheung Group might have collapsed under the fierce wave of the foreign exchange crisis, much like NewCore Group.
Whenever that thought crossed his mind, a chill ran down Chairman Park's spine.
He reached for a cigarette from a wooden box on the table. Secretary Gil quickly lit it for him.
Leaning back, Chairman Park inhaled deeply, then exhaled the white smoke slowly.
"Survival is the priority right now. Tell each affiliate not to overreach and just maintain the status quo."
"Understood."
At that moment, there was a knock on the door. Jung Yoon-kyung, a deputy manager wearing horn-rimmed glasses and a one-piece suit, opened the door.
"Sorry to interrupt."
"What is it?"
"President Park Seok-won of Daeheung Investment has arrived."
At once, Chairman Park's face lit up, and he straightened his posture.
"Send him in."
"Yes, sir."
Not long after Deputy Manager Jung Yoon-kyung left, Seok-won appeared with a smiling face.
"I'm here."
"Don't just stand there awkwardly. Sit over there."
Chairman Park pointed to an empty seat while holding a cigarette in his mouth.
Seok-won exchanged a glance with Secretary Gil Sung-ho seated across from him, then sat down next to his older brother, President Park Jin-hyung.
"Would you like me to prepare some tea?"
"No, I just had coffee, so I'm good."
"Understood."
After Jung Yoon-kyung closed the door behind her, Chairman Park looked at him with a soft gaze and asked,
"Coming by all of a sudden — this must be important. What do you want to talk about?"
"I'm acquiring a company, and I wanted to tell you before it hits the news."
"You're buying a company in times like these?"
Chairman Park's face showed surprise.
"There are many struggling companies, but because of the foreign exchange crisis, some solid firms are being sold dirt cheap. It's a great chance to pick up some quality assets at a bargain."
It wasn't a wrong statement, so Chairman Park nodded.
"Money is the problem, but that doesn't apply to you, so this might not be a bad idea."
He accepted the reasoning and asked with a cigarette between his fingers,
"So, what company did you acquire?"
Park Jin-hyung and Secretary Gil also looked on with curiosity.
Everyone knew Seok-won's keen judgment, so they were eager to hear which company he had chosen.
"We decided to acquire Ilhan Bank, Hansung Bank, and three credit finance companies — Sinchang, Goryeo, and Gyeongnam — all at once."
"...!"
For a moment, the room fell into a frozen silence.
Chairman Park, frozen with a cigarette in his mouth, blinked in disbelief.
Did I mishear...?
"Y-You said you acquired Ilhan and Hansung Banks?"
Seok-won nodded in confirmation.
"Yes. The three credit finance companies as well."
"Wow…"
Confirming he heard correctly, Chairman Park gave a bewildered chuckle.
President Park Jin-hyung and Secretary Gil also couldn't hide their astonishment.
Both Ilhan and Hansung Banks were among the top five major commercial banks in the country. It was more surprising that he had acquired not just one, but both at the same time.
Suddenly sitting upright and leaning forward, Chairman Park asked with a still-dazed look,
"Is that really true?"
"Yes. The official announcement will probably come out within two or three days."
Chairman Park, realizing this was no joke but the absolute truth, muttered in disbelief, "What is this, some kind of sudden thunderbolt out of nowhere?"
The other two also wore expressions of stunned disbelief.
They'd heard he was snapping up companies left and right, but banks? Banks, of all things?
After finally regaining his composure, Chairman Park asked, curiosity burning in his voice, "How on earth did this happen?"
He couldn't imagine what kind of deal could possibly let someone pick up banks like that.
"I recently met with Deputy Minister Choi, and the deal was made on the condition that we purchase roughly $10 billion worth of foreign exchange stabilization bonds, including the acquisition price."
"!"
Hearing this, Chairman Park's mouth dropped open.
President Park Jin-hyung and Secretary Gil also widened their eyes and unconsciously swallowed hard.
This wasn't a small sum — $10 billion — casually being discussed like it was nothing.
Chairman Park stubbed out his cigarette, barely smoked, into the ashtray, then turned to Secretary Gil.
"Gil, I'm suddenly terrible at math — how much is $10 billion in Korean won?"
Secretary Gil hurriedly did some mental math, then looked at Seok-won wide-eyed and answered,
"With today's exchange rate at 1,489 won, it's about 14.89 trillion won."
"...."
Shock and awe filled everyone's minds.
Not billions, but trillions?
After millions, billions, trillions — was that really the "jo (조)" unit they all knew?
"T-That's fourteen trillion, you said?"
Chairman Park's voice trembled slightly as he asked again.
"That's right."
Unable to even fathom such an astronomical amount, Chairman Park was momentarily speechless.
For comparison, the default amount from Hanbo Group — considered the initial signal flare of the foreign exchange crisis — was around 5 trillion won, so it was understandable.
Chairman Park suddenly turned sharply toward Seok-won, who sat calmly.
"Do you really have that much money?"
"Do you think I'd do a deal with the government like this without the money?"
Knowing well that Seok-won was not the type to make empty promises, Chairman Park reluctantly nodded in agreement.
"...That's true."
But then his expression suddenly changed to one of concern.
"Please tell me you didn't borrow it from somewhere, right?"
"Haha. It's all my own money, so there's no need to worry."
Chairman Park, who had been concerned that his son might have recklessly taken out loans due to greed, finally nodded in relief.
Once his worries faded, what occupied Chairman Park's mind was Seok-won's incredible wealth.
He knew Seok-won had made a lot of money through smart investments, but the fact that he actually had a cash reserve of a staggering $10 billion left him amazed.
Just then, Park Jin-hyung, who had finally regained his composure, looked at his younger brother with a stunned expression but quickly hardened his face and said,
"I've heard both banks have so many non-performing loans that they're in a dangerous state. Isn't there a risk you'll just get a headache from this acquisition?"
"Yeah. It could easily turn into a case of the tail wagging the dog."
Chairman Park nodded seriously in agreement, but Seok-won remained calm and confident.
"The government has already taken most of the bad debts off the books before handing them over. We plan to quickly normalize the banks by injecting fresh capital through a rights offering."
"Do you intend to put in more money yourself through the rights offering?"
Chairman Park asked, and Seok-won nodded.
"Yes. That's probably the fastest and surest way."
"The amount of bad debt is so huge that a modest sum won't even make a dent. How much capital injection are you planning?"
"About $1 billion should be enough to put out the immediate fire."
"W-What was that?"
"One billion dollars."
No matter how they imagined it, the answer from him, who kept raising the stakes, left Chairman Park utterly dumbfounded.
"How much money do you actually have?"
Seok-won smiled faintly at the corner of his mouth and replied,
"Well, I honestly don't know, since it keeps growing in real time even as we speak."
To outsiders, it sounded like a joke, but Seok-won's expression showed he was serious.
The three men stared at him like they had just been hit by a bombshell.
Chairman Park opened his mouth to say something but finally just shook his head in disbelief.
"Wow. Really."
Then, with a pleased expression, he said,
"In a situation where every dollar counts, you laid out a full $10 billion. There's no way the government could refuse that. Yeah."
Chairman Park cracked a relaxed, wide smile.
"If you add a big bank on top of the venture capital and securities businesses, this small house might end up bigger than the big one. Don't you think?"
"That's exactly right."
Park Jin-hyung also smiled as he replied.
If he had been jealous or uncomfortable about Seok-won's success, it would have shown long ago.
Having recognized his younger brother's talent early on, Park Jin-hyung, who had become independent, simply felt proud watching Seok-won confidently walk his own path.
"If the other chairmen find out about this, they'll flip out. I'm already looking forward to the next Federation of Korean Industries meeting."
Chairman Park's face lit up, clearly excited at the thought of boasting about his son.