Bo-eun leads the digital content team. She has covered foreign affairs, North Korea, tech, economy and gender issues at The Korea Times. She did a short stint at the South China Morning Post in Hong Kong, where she obtained a new perspective on news production and life. Small sources of joy for her are lounging in the sun, having a good latte and swimming.
Savings banks turn to Southeast Asia
Officials pose after holding a ceremony marking OK Financial Group's merger of Bank Oke Indonesia and Bank Dinar, in Jakarta, Oct. 19. From fourth from left is the group's vice chairman Kim In-hwan, Bank Oke Indonesia CEO Lim Cheol-jin and the group's chairman Choi Yoon. / Courtesy of OK Savings Bank
By Kim Bo-eun
By Kim Bo-eun
Local financial groups with savings bank units are following in the footsteps of commercial banks, making inroads into in Southeast Asia as they face limited growth circumstances here.
OK Financial Group, which runs OK Savings Bank, completed a process on Oct. 19 to merge its Bank Oke Indonesia with the country's Bank Dinar. The move came after the group acquired Bank Dinar and made it a unit of its group in October last year.
The integrated entity will operate under the name Bank Oke Indonesia. The bank currently has about 20 branches in Indonesia, and plans for further expansion.
OK Financial Group is the fourth Korean lender to enter Indonesia after KEB Hana Bank, Woori Bank and Shinhan Bank.
It opened Bank Oke Indonesia in 2016 after it acquired the country's Bank Andara.
A group official said, “The merger between Bank Oke Indonesia and Bank Dinar took place due to local regulations on equity stake, but this is also set to help with the bank's localization strategy,” noting 98 percent of the bank's employees are Indonesian.
The group recently changed its name to “OK Financial” from Apro Service Group in line with its plan to boost its standing as a financial group.
“We are seeking a blue ocean and new challenges,” the official said.
“We will do our best to let more countries know of the group's unlimited growth potential, and we can see this unfold in Indonesia,” the group's chairman Choi Yoon said at a ceremony held marking the two banks' merger last week.
In August, Welcome Financial Group, which owns Welcome Bank, another major savings bank in Korea, acquired Smart Bank, based in Manila, the Philippines.
The bank attained a license to be able to do deposit and loans business there.
The group established its capital firm Welcome Finance in 2014, which has focused on credit business such as auto financing.
The group is hoping that the banking business will create synergy with its capital unit's operations there.
“The region is growing fast, and we believe we can play a role in facilitating growth,” a Welcome Bank official said.
“Circumstances here are not so good and stronger regulations that will go into effect are worsening the situation.”
The increased focus of Korean savings banks on Southeast Asia comes as they face tougher circumstances here.
The top 10 savings banks managed to increase their earnings in the first half of 2019 but their growth has stagnated.
However, 79 savings banks' total assets grew by only 1.8 percent in the first half of this year from a year ago. This is a major setback from the 16.4 percent expansion in the first half of 2018.