Monday, August 12th, 2013
Shinhan Bank has 65 offices in 15 countries while Woori Bank hold 63 locations in 17 nations. Last year, Kookmin Bank opened a new branch office in Osaka following a Tokyo office. Hana Bank meanwhile is focusing on expanding its sales network in China. The annual asset volume growth rate of Hana Bank China, the local banking corporation established by Hana Bank, has been 45 percent for the past few years.
But some banking experts are critical about the Korean banks' global reach strategies on the grounds that the banks' profitability is steadily on a downward trend despite a rise in assets. As of the end of 2012, the aggregate net profit of overseas branch offices by Korean banks was US$636.2 million, down 11.2 percent from the previous year's $721.6 million.
Suh Byeong-ho, research fellow with the Korea Institute for Finance, said, "Korean commercial banks must be able to carve out niches where multinational banks have not yet reached, in such areas as small- and medium-size project financing deals. Otherwise, they will soon fall behind the likes of Japanese and Chinese banks that are vastly superior in terms of capital mobilization and interest rate competitiveness."