ING Groep edged closer to completing its 1½-year-old Asia divestment plan after private equity firm MBK Partners agreed to buy its South Korean insurance unit for total cash proceeds of $1.66 billion.

Under the agreement announced yesterday, the bailed-out Dutch insurer will retain about a 10 per cent stake in the South Korean unit and allow MBK to use the ING brand for up to five years.

The sale of the South Korean unit will leave ING with its Japan insurance unit left to sell, bringing it closer to fulfilling its agreement with European regulators to offload more than 50 per cent of its Asian operations by the end of 2013.

Since its rescue in 2008, ING has dismantled its once-fashionable banking and insurance model and announced thousands of job cuts and other cost savings. – (Reuters)