Rising interest rates will be a major challenge for the South Korean banking industry next year, which may also threaten the country’s financial system at the worst, warned financial experts Monday. As the new US government under President-elect Donald Trump is raising the probability of the Federal Reserve making rate hikes at a faster pace than expected before, financial risks are mounting here where households and businesses have been relying on leveraging borrowed funds for the past two year

Dec. 5, 2016

Loans extended to local businesses rose slightly in the third quarter from a quarter earlier on increased facility investments, central bank data showed Monday.Corporate loans climbed by 15.7 trillion won ($13.3 billion), or 1.6 percent, in the July-September period to 986.4 trillion won from three months earlier, according to data from the Bank of Korea (BOK).Year-on-year, the third quarter results marked a 5.9 percent gain.By purposes, loans extended for companies' operating expenses were up 1

Dec. 5, 2016

Most of the recent new entrants to the South Korean stock market are trading below their initial public offering (IPO) price, data showed Monday, as investors remain spooked by unfavorable foreign and domestic factors.Out of the 12 companies that have listed their shares on the main and secondary bourses since November, eight finished below their IPO price as of Friday, while the rest managed to make gains by staying above their issue price, according to the data by the Korea Exchange (KRX). A c

Dec. 5, 2016

South Korea's listed companies have almost doubled their issuance of convertible bonds (CBs) this year amid financial troubles largely attributable to corporate restructuring and lower profitability, data showed Monday.The volume of CBs sold by firms listed on the main KOSPI and secondary KOSDAQ markets in the first 11 months of 2016 totaled 5.03 trillion won ($4.3 billion), up 94.3 percent from a year earlier, according to the Korea Exchange. A image of corporate bond yields (Yonhap)CBs issued

Dec. 5, 2016

Citibank Korea will challenge the current adverse conditions in the banking industry with a new business model for wealth management instead of seeking quantitative growth, said CEO Park Jin-hei on Thursday. Despite falling profits this year, Park has decided to focus on materializing a new concept of wealth management and “smarter mobile banking” for Korean consumers, and has come up with a noticeable outcome -- opening of the country’s largest wealth management center in Cheongdam in the afflu

Dec. 1, 2016

South Korea’s central bank said it will carry out a test project in the first half of next year to reduce the use of coins.The Bank of Korea said it will select convenience stores and prepaid card companies by January in an initial test to encourage those who spend with cash at convenience stores to use their loose change to charge prepaid cards such as transportation cards.  (photo by 123rf)“We will shortly release the notice about the test project and get applications from convenience stores.

Dec. 1, 2016

The two brokerage units under South Korea's Mirae Asset Financial Group have hired a large number of employees this year ahead of their planned merger despite the securities industry's slump, sources said Thursday.Mirae Asset Daewoo Securities Co., formerly KDB Daewoo Securities Co. owned by the state-run Korea Development Bank, completed the hiring of 59 new employees the previous day. Mirae Asset Securities Co. has also employed 141 new workers and career staff this year.In April, Mirae Asset

Dec. 1, 2016

South Korea's state-run Korea Deposit Insurance Corp., on Thursday signed a 2.4 trillion won ($2 billion) deal with seven institutional investors on the sale of Woori Bank, ending years-long attempts to privatize the state-owned bank.Under the deal, IMM Private Equity and Mirae Asset Global Investments Co. will take over 6-percent and 3.7-percent stakes, respectively, in Woori Bank. Hanwha Life, Tongyang Life Insurance Co. owned by China's Anbang Insurance Group Co., Eugene Asset Management Co.,

Dec. 1, 2016

South Korea's state financial watchdog said Wednesday it has established a consolidated monitoring system for the nation's credit unions and other financial cooperatives.There have been difficulties in regulating the industry vulnerable to financial accidents and breaches, with 2,263 firms, mostly small, operating nationwide, according to the Financial Supervisory Service (FSS). A file photo of the National Federation of Fisheries Cooperatives' building. (Yonhap)The FSS launched the Advanced Det

Nov. 30, 2016

South Korea's recent local real estate market boom has been largely driven by a government policy to ease bank loan regulations, a report by a state-run think tank said Wednesday.Housing construction in the country has been accelerating for more than a year since the government lowered a set of financial regulations on home-backed household debts -- the debt-to-income (DTI) and loan-to-value (LTV) ratios -- in August 2014.As a result, new construction permits had grown for 16 months in a row unt

Nov. 30, 2016

Deposits at cash management accounts rose to a record high this week, as investors stayed on the sidelines over a lackluster performance in stock markets, data showed Wednesday. A cash management account refers to a type of account offered by brokerage houses and other financial institutions that allows an account holder to trade equities while earning interest on cash balances. The net asset value of cash management accounts reached 53.1 trillion won ($45.5 billion) as of Tuesday, up 500 billio

Nov. 30, 2016

Loan guarantees among affiliates of South Korea's large business groups sank in 2016 from a year earlier, the country's corporate watchdog said Wednesday.The total corporate debt payment guarantees made among units of 27 conglomerates reached 321.2 billion won ($274.5 million) as of April 1, down 24.8 percent from 426.9 billion tallied a year ago, according to the Fair Trade Commission (FTC). Corporate images of South Korea's 30 large business groups.The total number of conglomerates eligible to

Nov. 30, 2016

South Korea’s state-run financier has established connections across Southeast Asia to export its know-how on development finance to other countries.The Korea Development Bank announced last week that it has signed a memorandum of understanding with Sarana Multi Infrastruktur, or SMI, its Indonesian counterpart to open a local operational office named “Korea Desk” in Jakarta. The KDB’s Korea Desk will be installed in the headquarters of SMI, and the two banks agreed to work together on project f

Nov. 29, 2016