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Wed, February 2, 2022 | 17:00
Non-banks
Digitization forces brokerages to shut down branches
Posted : 2019-09-19 16:42
Updated : 2019-09-20 10:31
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By Jhoo Dong-chan

Domestic securities firms are downsizing the number of their branches since an increasing number of customers now prefer non-face-to-face stock trading via smartphones, but some brokerages are rather opening more branches to strengthen their wealth management businesses.

According to the Korea Financial Investment Association, the number of Mirae Asset Daewoo's branches stood at 83 in August, down 39 percent from 136 in December.

KB Securities also had 118 branches at the end of last year, but shut down two branches in the first half of the year. The securities firm said it will close one branch by the end of the year.

Small- and medium-sized brokerages are also following the trend.

Yuanta Securities, which operated 67 branches last year, closed one branch in the first half and another two last month.

The downsizing trend is attributed to more customers using non-face-to-face trading systems. According to the Korea Exchange, the average stock trading volume using home trading and mobile trading system is estimated at around 4.53 trillion won ($3.82 billion) this year, accounting for about 45.1 percent of the entire trading volume.

In the meantime, some securities firms such as Korea Investment & Securities, increased the number of their branches in a bid to strengthen their wealth management businesses for rich customers.

Korea Investment & Securities, which operated 87 branches last year, add one more branch this year.

"In a bid to strengthen corporate and wealthy customers' experience, Korea Investment opened one branch on Yeouido, Seoul," said a Korea Investment & Securities official.

"It's true non-face-to-face is a trend, but there are still a strong number of investors seeking face-to-face services especially when it comes to managing their assets."

Following Korea Investment's lead, Meritz Securities, which had operated six branches nationwide, opened one branch in the Gangnam area, exclusively offering wealth management services for wealthy customers.

"Now, brokerages are transforming themselves based on their focus portfolio. Those securities firms, who concentrate on WM businesses, would still maintain their branch network since wealthy investors still tend to talk to an expert when investing their money," said a major securities firm official who asked not to be named.
Emailjhoo@koreatimes.co.kr Article ListMore articles by this reporter



 
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