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KB Card's Cambodian subsidiary sees brisk performance
KB Daehan Specialized Bank's office in Cambodia Courtesy of KB Kookmin Card
By Lee Kyung-min
By Lee Kyung-min
KB Daehan Specialized Bank (KDSB), a Cambodian subsidiary of KB Kookmin Card, posted $114,000 (137 million won) in net profit for the first half of 2019, less than a year after the branch began operations, the firm said Wednesday.
This is a resounding success for the subsidiary in Phnom Penh set up as a joint venture with LVMC Holdings to provide auto financing and mortgages.
The KDSB saw its operating profit jump to over $2.9 million in the first half of the year, about a three-fold increase from the four-month period after the launch of the branch in September 2018.
The figure was $898,000 in the September to December period.
The performance was driven by CEO Lee Dong-cheol's localization strategy to serve the specific needs of Cambodians.
Lee introduced a marketing strategy that he considers a highly effective way to secure new customers who need auto financing by requiring cars produced by LVMC Holdings be tied to the firm-operated financing program.
Cooperation with SsangYong Motor and Ford helped the firm offer various financing programs with different borrowing rates that tended to various customers' needs.
Experience in auto financing has helped KB Card expand into the mortgage business which diversifies the firm's business portfolio.
The aggressive expansion has led to a rapid asset increase over the past few months.
“Now our focus is to help stabilize the relatively new business in Cambodia,” a KB Kookmin Card official said.
“We then plan to expand our business into nearby countries such as Myanmar and Laos. Our experience in the Cambodian market will help us to do better and make minimal mistakes,” the official added.
Meanwhile, KB Financial Group Chairman Yoon Jong-kyoo's steadfast efforts to foster global talent also contributed to the better-than-expected success.
Under Yoon's initiative, KB Kookmin Card runs a special training program on risk management, auto financing, digitization and credit card marketing for dozens of officials at the group's subsidiaries including those in Southeast Asian countries.