Nonghyup Financial Group is seeking to expand its business in Indonesia and Myanmar amid the lackluster domestic economy, its chairman Kim Yong-hwan said Monday.

The former chief of state-run Export-Import Bank of Korea told local reporters that he is “considering M&A and buying bank stocks in Indonesia and Myanmar” as steps to stretch global operations. 

Having served key posts in the Finance Ministry, Financial Supervisory Service and the EXIM Bank, Kim stressed the significance of global operations to boost Nonghyup’s growth. He assumed office on April 29.

“Foreign operations targeting Korean companies and expats do not yield much profit,” he noted, yet emphasized that Nonghyup needs to head overseas. This will require taking full advantage of Nonghyup’s agricultural cooperative operations, he added.

However, the group’s spokesperson later denied any immediate consideration of M&A with foreign banks, “As the group has no substantial foundation or partnerships in Southeast Asia.” He ruled out any overseas deals this year.

Meanwhile, the chairman said Nonghyup’s operations should reach out overseas on the strength of its nonfinancial products. Since its holding company National Agricultural Cooperative Federation is the country’s largest agricultural cooperative, Kim is mulling ways to team up to offer financing services for NACF’s export operations.

For instance, the group has been the financing partner of the federation for supplying dairy products to Chinese retail giant Xinxiwang Group since January.

Later this week, the financial group will sign a memorandum of understanding with Chinese retail giant Hwalian Group. The agreement states that NACF will annually supply its agricultural goods worth 1 trillion won for three years.

Regarding the group’s home operations, Kim hinted at shifting and closing some unprofitable branches, while launching more in the lucrative Seoul and the surrounding metropolitan areas.

He also sought a stronger shift to financial services via mobile devices, targeting customers in their 20s and 30s. He said the bank needs adapt quickly to the burgeoning mobile-based lifestyle.

By Chung Joo-won and news reports (joowonc@heraldcorp.com)