Korean banks strengthening foothold in India

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By Jhoo Dong-chan

The nation's commercial banks are now eyeing India after managing a successful entry into the Southeast Asian market.

Keeping up the Moon Jae-in administration's New Southern Policy to strengthen ties with the Association of South East Asian Nations (ASEAN), they are expanding their presence abroad to overcome the saturated domestic financial market.

The banks are now targeting India, reflecting the country's rapid and steady growth over the past decade.

KEB Hana Bank said Thursday it had assigned an executive to prepare the establishment of a new branch in Gurugram, in the northern Indian state of Haryana.

The bank set up its first office in New Delhi in 2008, switching it to a branch in Chennai in 2015.

During his inauguration, KEB Hana Bank CEO Ji Sung-kyoo vowed to strengthen the bank's overseas earnings to 40 percent of its total by 2025, from the current 15 percent.

On July 22, KEB Hana Bank paid over 1 trillion won ($875 million) to buy shares in the Bank for Investment and Development of Vietnam, the country's largest bank by assets.

KB Kookmin Bank also displayed a strong interest in the Indian market by opening its first branch there in Gurugram earlier this year.

“KB Kookmin Bank plans to open five more branches in the country over the next five years,” said a KB Kookmin Bank official.

In 1996, Shinhan Bank became Korea's first bank to open a branch in India, and currently operates six, with plans to add two more in Bengaluru and New Delhi.

Woori Bank has also opened three branches while waiting for the country's financial authorities to approve the establishment of a corporate body there.

Woori Bank said it will set up 20 more branches over the next five years as soon as it gets approval.

NH NongHyup Bank also plans to turn its New Delhi office into a branch soon.

“Only a few people have a bank account in India. Also it is a huge country, and so Korean banks see opportunities there,” said an NH NongHyup Bank worker.

“India could play a pivotal role for these banks in their entry to West Asia as well as the Middle East.”