South Korean financial regulators on Wednesday approved private equity firm MBK Partners' KRW1.84 trillion ($1.75 billion) purchase of Dutch bank ING Groep's local insurance unit. This is the country's largest insurance acquisition to date, said a Reuters report.

According to Reuters, MBK and ING announced the deal in late August. The bailed-out Dutch bank is obliged to offload more than 50% of its Asian operations by the end of 2013. The Financial Services Commission decided to let a special-purpose company established by MBK buy some 8.2 million shares in ING Life Korea, Wall Street Journal (WSJ) said in a separate report.

ING Groep will retain about 10% stake in the insurance unit by participating in the special-purpose company. Under the deal, MBK is also allowed to use the ING brand for up to five years, Reuters said.

WSJ said ING's first attempt to sell its Korean insurer came last year. But the deal with Seoul-based banking giant KB Financial Group Inc. collapsed in December following fierce opposition by KB's non-executive directors, as stated in the Reuters report.