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.
Card firms enjoy solid growth in overseas businesses
Shinhan Financial Group Chairman Cho Yong-byoung speaks at a ceremony marking the launch of Shinhan Card's subsidiary, Shinhan Vietnam Finance Company, in Ho Chi Minh City, last July 2. / Courtesy of Shinhan Card
By Kim Bo-eun
By Kim Bo-eun
Korea's major card firms saw their overseas businesses switch to a surplus last year, indicating that their seamless efforts to find new revenue sources abroad have finally paid off amid deteriorating circumstances here.
Shinhan, KB Kookmin and Woori Card all enjoyed significant earnings growth in their businesses in Southeast Asia in 2019.
Shinhan Card, the nation's largest plastic issuer by assets and net profit, recorded 20.5 billion won in net profit from four subsidiaries in Vietnam, Myanmar, Indonesia and Kazakhstan.
Shinhan Vietnam Finance Company (SVFC) alone posted 18.3 billion won in net profit. SVFC was launched in July 2019 after Shinhan acquired Prudential Vietnam Finance Company, which was the U.K.-based Prudential Financial Services Group's Vietnam unit.
"Our overseas earnings surged after SVFC was launched, as it is a subsidiary based on the acquisition of a major local unit," a Shinhan Card official said.
Shinhan Finance in Kazakhstan posted 1.31 billion won in net profit, Shinhan Microfinance in Myanmar posted 359 million won and Shinhan Indo Finance 465 million won.
KB Kookmin Card also saw its subsidiary in Cambodia post a surplus last year. KB Kookmin launched KB Daehan Specialized Bank in 2018, after acquiring Cambodia's Tomato Specialized Bank the same year.
The subsidiary posted a net loss of 255 million won in 2018, but saw a net profit of 107 million won last year.
KB Kookmin's Cambodian subsidiary opened a branch in Sen Sok, Phnom Penh, in February, as it seeks to expand its presence in the Southeast Asian country.
KB has subsidiaries in Laos and Myanmar and is set to launch a subsidiary in Indonesia this year, after signing a deal in November to acquire PT Financial Multi Finance, a local credit finance company.
Woori Card's Myanmar subsidiary Tutu Finance also switched to a surplus last year. Tutu Finance recorded a 346 million won net loss in 2018, but posted 2.71 billion won in net profit last year.
Card firms had geared up to accelerate their overseas business this year, but face uncertainties based on the coronavirus pandemic.
Southeast Asian countries, where their subsidiaries are located, have been less affected by the virus compared to the U.S. and countries in Europe.
However, card firms remain vigilant over the potential impact from the rapid spread of COVID-19.
"Southeast Asian countries have so far been less affected by the pandemic but they will inevitably be hit hard if Western economies suffer several blows," an official of a card firm said.