South Korea’s Woori Bank said Sunday it recently merged two of its Cambodian subsidiaries in an effort to provide comprehensive financial services in the Southeast Asian nation.

According to the commercial lender, Cambodian financial authorities approved the merger of Woori Finance Cambodia and WB Finance earlier this month. WB Finance is the surviving entity.

Woori Finance Cambodia was established after Woori acquired Cambodia’s microfinance institution Malis Finance for 5 billion won ($4.9 million) in 2014. The microfinance subsidiary’s total lending and net profit had jumped twelvefold and fourteenfold, respectively, in the last five years, according to Woori.

In 2018, the Korean lender launched its second Cambodian subsidiary, WB Finance, after acquiring microfinance institution VisionFund Cambodia. WB Finance operated 116 sales network, including branches, across Cambodia prior to the latest merger. Its assets had increased nearly 60 percent within a year of its establishment, Woori said.

Bolstered by its successful expansion in the Southeast Asian nation, Woori saw its net profit from Cambodian businesses jump to an annual $17 million in 2019 from $4 million in 2017.

Woori plans to improve customer convenience and accessibility through cooperation with financial technology and platform businesses. It also aims to expand its retail business by establishing a local credit rating system and offering non-face-to-face or online products to its customers.

“The new entity is the fifth-largest among Cambodian savings banks by assets and profit,” a Woori Bank official said.

“WB Finance aims to provide comprehensive financial services in Cambodia by gradually transforming into a commercial bank,” the official added.

Korean financial institutions have been expanding their presence in ASEAN member states in line with President Moon Jae-in’s New Southern Policy announced in 2017. The initiative aims to deepen and expand ties with ASEAN member states, eyeing their growth potential, rich resources and geopolitical strengths.

By Jung Min-kyung (mkjung@heraldcorp.com)