Yi Whan-woo is a Korea Times journalist primarily covering finance. He writes in-depth articles on macroeconomy and financial markets and previously covered sports, politics, diplomacy and inter-Korean affairs, among others. Feel free to contact him at yistory@koreatimes.co.kr.
Shinhan chosen for 2nd time as Seoul's 'safekeeper'
Front view of the former Seoul City Hall / Korea Times file
By Yi Whan-woo
By Yi Whan-woo
Shinhan Bank has won a bid to manage the Seoul Metropolitan Government's coffers worth nearly 48 trillion won ($38.9 billion) from 2023 to 2026, the lender announced Friday.
The successful bid sees the country's second-largest commercial bank continuing to serve as the “safekeeper” of the nation's capital since 2019.
Shinhan Bank's headquarters in central Seoul / Korea Times file
“We have been notified about the result by the city government,” a public relations representative told The Korea Times, adding no further details will be disclosed.
The bank will manage both primary and subsidiary coffers of the city government.
The former deals with the annual budget of 44.2 trillion won and the latter handles the 3.5 trillion won fund raised by the metropolitan government. The combined figure of 47.7 trillion won is the highest among all city and provincial governments in the country.
Shinhan is currently managing the primary coffer for the 2019-2022 period, after winning the bid for the first time on a four-year contract in 2018.
The subsidiary coffer is currently managed by Woori Bank, which until 2018 had been considered the sole safekeeper for the Seoul government since 1915 when its predecessor managed the budget for Japanese imperialists ruling the city.
Woori Bank, along with KB Kookmin Bank, also competed in the 2022 bid.
Industry sources speculated that Shinhan Bank as Seoul's finance manager can help to enhance its brand image, bolster marketing campaigns and attract new customers including family members of Seoul Metropolitan Government officials.
Meanwhile, the sources said Shinhan scored high especially in the category of interest rates for loans and deposits among multiple qualification criteria.
It also led competitors in terms of the number of ATMs, which had been counted to assess the bidders' commitment to offline bank operations.
This factor was newly added to the list of criteria, to ensure that citizens regardless of age have easy access to banking services amid accelerated financial digitalization, to which a significant number of elderly people have found it difficult to adapt.
Shinhan is the only commercial bank that operates more than 2,000 ATMs in Seoul.
Other criteria were banks' credit ratings, financial soundness, online banking security and community service records.