Kakao Corporation is set to become the largest shareholder of an Internet-only bank that it launched four years ago.  

The Financial Services Commission(FSC) on Wednesday allowed Kakao to hold up to 34 percent of the shares of Kakao Bank from the current 18 percent. Korea Investment Holdings currently has 50 percent of the bank’s shares, but is expected to become the second largest shareholder following the measure. 

In allowing the firm to hold excess shares of the bank, the watchdog said it took into account several factors, including Kakao’s financial health and compliance with laws.

Last September, the National Assembly passed a bill allowing non-financial firms to boost their stake in Internet-only banks to 34 percent. A share increase still requires approval from the financial authorities.