Korean banks’ inroads in Cambodia raise concerns of criminal exploitation

A motorcyclist drives past signboards of local businesses operated by KB Kookmin Bank and Shinhan Bank in Phnom Penh, Cambodia, Tuesday. The country is suspected of being a stronghold of Prince Group accused of running online scams targeting Korean nationals. Yonhap

By Yi Whan-woo

• Published Oct 22, 2025 4:11 PM KST

Prince Group made transactions via Korean banks, gov't data showed

Korean banks have achieved their most successful overseas localization in Cambodia, a country at the center of controversy over online scams and other crimes targeting Korean nationals, government data showed.

The ongoing controversy over crime rings in Cambodia is undermining Korean banks’ yearslong localization efforts and global expansion campaigns there. Rather than being celebrated, the achievement has raised concerns that the Korean lenders may have been unknowingly used by criminal networks accused of kidnapping, defrauding, torturing and even murdering Koreans in the Southeast Asian nation. Included among them is Prince Group, which was designated by the U.S. Treasury as a “transnational criminal organization.”

According to a report by the Financial Supervisory Service (FSS), Cambodia ranked first among 41 countries in Korean banks’ overseas localization performance in 2024.

In the private sector, KB Kookmin Bank, Shinhan Bank, Woori Bank and iM Bank each operate one corporate entity in Cambodia, while Jeonbuk Bank runs two.

Among state-run and government-affiliated banks, the Export-Import Bank of Korea, the Industrial Bank of Korea, NH NongHyup Bank and Suhyup Bank also conduct retail banking in the country through branches, subsidiaries or liaison offices.

The FSS scored these businesses highly in localization efforts, including the proportion of local customers, employees and executives, as well as in international business capabilities.

Those scores were high enough to offset a weakness stemming from a 9.2 percent decline in their combined net income, which fell from $145 million in 2023 to $132 million in 2024.

Cambodia received the highest localization rating of 1+ in FSS country assessment rankings. This rating surpassed the average score of 1 across 41 countries, including Indonesia, which received a 1, and Japan and the Philippines, which were rated 1-.

However, civic groups and financial market experts argue that these high scores overlook serious risks on the ground.

“The banks’ localization efforts are certainly commendable,” an activist at the Citizens’ Coalition for Economic Justice (CCEJ) said. “But this situation highlights the risk that they may have been unknowingly used by Prince Group.”

The concern is based on separate FSS data obtained and released by Rep. Kang Min-kuk of the main opposition People Power Party, a member of the National Assembly’s National Policy Committee.

According to the data, Prince Group carried out 52 financial transactions using Korean banks in Cambodia, amounting to approximately 197 billion won ($137.7 million).

Of that, 91.2 billion won remains in the banks’ local accounts.

Industry officials noted that Korean banks in Cambodia primarily offer retail services tailored to local customers' needs, such as cash withdrawals, currency exchange and credit card services. While these services were introduced to boost customer convenience, they may have also made it easier for organized crime to carry out its operations against Korean victims, the officials explained.

“Given the circumstances, it is difficult to rule out the possibility that Korean bank subsidiaries in Cambodia were exploited by crime rings,” the CCEJ activist said. “The banks should operate with greater caution in foreign markets, and the FSS should reconsider its evaluation criteria to ensure that efforts to expand globally do not come at the expense of financial security.”