By Kim Jae-won
Staff Reporter

With the global economic crisis showing signs of waning, banks are looking outside the nation to try and take advantage of being the first movers in emerging markets.

Limited growth option in domestic markets and the huge rising Asian market are boosting the trend. Growing demand from international students and workers is another reason for banks to pioneer new branches abroad.

Shinhan Bank is taking the lead by setting up subsidiaries worldwide, including in Canada, Japan and Vietnam. The lender established a subsidiary in Toronto in March this year, followed by opening a corporate entity in Tokyo in September to reflect its strategic importance. It also transferred its Ho Chi Minh City branch into a new subsidiary, ShinhanVina Bank in the capital city, Monday to capitalize on the rapidly growing market there.

Since the bank already has branches in Japan and Vietnam, the subsidiaries are expected to generate stable profits and capture economies of scale by gaining more ground in the countries.

``We hope to find new markets in those countries after adjusting to the local conditions. We are pursuing so-called glocalization, a term coined to describe both globalization and localization at the same time,'' Kim Young-gil, the manager of public relations at the bank, told The Korea Times.

Hana Bank has focused on China, achieving remarkable growth in the third largest economy in the world.

Hana Bank China, its subsidiary there, saw its total assets soar by 50 percent to $1.85 billion at the end of last year from a year ago, with total loans valued at $1.32 billion. In particular, its deposits reached $869 million, up 662 percent from $114 million a year earlier. It posted a net profit of $11.3 million in 2008.

Hana has viewed China as a major overseas target market ever since it opened its first office in Shanghai in 1996. In December 2007, Hana established Hana Bank China, with total assets of $975 million, 299 employees and seven branches ― in Beijing, Shanghai, Shenyang, Qingdao, Yantai, Qingdao Chengyang sub-branch and the Beijing Business Department.

Woori Bank has trained regional specialists to expand their overseas branches with programs such as demand research and internships at local financial institutions. So far, 52 experts are working in 50 branches in 15 countries.

Kookmin Bank is trying to set up a ``KB Triangle Network,'' which combines the Central Asia, China and South Asia regions. The nation's top bank has increased its stake in Kazakhstan bank BCC from 30.5 percent to 40.1 percent. The BCC is the sixth largest bank in terms of total assets in the Central Asian country.

However, some analysts say that banks need to be cautious and manage the risk of long-term projects.

``If domestic banks want to localize such branches abroad, it takes time and requires many resources. I think that it is somewhat risky because the global recession has not fully ended,'' Hwang Hee-jung, an analyst of Korea Investment and Securities said.

shosta@koreatimes.co.kr