Shinhan focuses on Asia for globalization
Customers get services at a branch of Shinhan Bank Vietnam, the local arm of the Korean bank in this undated file photo. Shinhan is seeking to expand further in Asia, particularly in Vietnam and China. / Courtesy of Shinhan
By Kim Jae-won
Shinhan Bank focuses on Asia for its global expansion as the region has big growth potential compared to advanced economies, the company said Monday. Shinhan said that they opted to invest in emerging markets in Asia, such as China, Vietnam and India where the company has relatively better competitiveness.
The nation’s third-largest lender by assets also seeks to enforce its Japanese business, where its key shareholders are based. Shinhan was established by Korea-Japanese businesspeople in the early 1980s who still own a combined 17 percent stake in Shinhan Financial Group, a parent company of the lender.
“It is part of our global strategy which seeks to establish a platform for new growth as the local financial market is almost saturated,” said the lender in a statement.
Shinhan has launched three overseas branches so far this year ― two in China and one in Japan ― extending its international network to 62 in 14 countries. In 2011, the lender opened six branches in four countries ― two in Japan and Vietnam, respectively, and one each in China and Cambodia. The lender said it will keep up the pace next year, and the expansion will be bigger and faster.
The country’s most profitable bank said that it will implement its strength in marketing, customer services and risk management in the countries to boost sales in services and products. The company’s advanced information technology services also will be added to create synergy there, according to Shinhan.
Thanks to the bank’s aggressive global expansion plan, about 5 percent of its revenue came from overseas markets in the first half of this year, up from 3 percent in 2010. CEO Suh Jin-won vowed to increase the portion to 10 percent by 2015 right after his inauguration in December 2010.
Shinhan said that every single operation in overseas countries, including Canada established amid the global financial crisis, posted profits in the latest quarter, signaling that Suh’s ambitious dream will come true in the near future.
To make this be realized even earlier, the bank has set up a three-step strategy to embed itself in overseas markets. The first is increasing its influence with Korean companies doing business in the region. Secondly, it is seeking to attract local corporations in key cities. And lastly, it aims to become a leading foreign lender by increasing its market share.