Consultation with foreign regulators emerges as key task for success


Korean banks have been in competition to win eased regulations from overseas financial regulators as they tap emerging markets.

Their main targets include East, Southeast and South Asian countries.

“We are developing financial products which will come under deregulation from regulatory authorities in China, Vietnam and Brazil,” a senior executive at Korea Exchange Bank said.

He said KEB is mapping out strategies to regain competitiveness in its overseas units under the initiative of its CEO Yun Yong-ro.

Toward that goal, securing deregulation in consultation with foreign supervisory authorities is important, he said.

The executive added that KEB is considering enhancing “the private banking business, focused on wealthy Koreans residing in countries such as Japan, Indonesia and Hong Kong.”

Its private banking targets also include rich Koreans in the Unites States.

Though the bank also plans to make inroads into South American markets, its strategy does not involve private banking.

He said rich customers in Latin America tend to transfer their assets to other continents including North America for security reasons. Instead, KEB is focusing on corporate financing there.

Woori Bank is striving to open more branches in China. It recently opened its 13th Chinese branch and relocated its key outlet in Beijing to a business hotspot to enhance its private banking service for rich clients.

Among the commercial bank’s overseas targets for this year are Chennai, India and Dacca, Bangladesh.

Securing eased regulation in emerging markets will be a core part of its appeal to Korean retail and corporate customers in those countries, according to Woori executives.

Woori currently has a total of 50 overseas offices in 15 countries worldwide. The lender recently added a new office in Indonesia and two branches in China.

Shinhan Bank, in a bid to avail of a variety of deregulations, is providing locals with a variety of educational programs in overseas markets

Via the programs, the commercial bank is also aiming to foster human resources as part of its long-term vision for wider global projects.

But due to externally unfavorable factors in the wake of the eurozone debt crisis, Shinhan is prioritizing sustainable growth rather than aggressive expansion this year.

The commercial bank plans to strengthen operating power in major branches in key Asian markets Japan, China, Vietnam and India.

Earlier this month, Shinhan Bank held a gratitude event in Ho Chi Minh, Vietnam, by inviting about 300 figures.

Through recent mergers and acquisitions, Shinhan has become the second-largest non-Vietnamese bank following HSBC in the Southeast Asian country.

Kookmin Bank is set to open branches in China and Osaka, Japan this year.

In addition, Korea’s No. 1 lender is moving to open a liaison office in Mumbai under its strategy to diversify operating networks.

Hana Bank, an affiliate of KEB, plans to increase the number of branches of its Indonesian unit.

Hana, which opened its first office in Shanghai 15 years ago, views China as one of the most lucrative markets.

By Kim Yon-se (kys@heraldcorp.com)