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KakaoBank draws over 20 mil. users after opening in 2017

The headquarters of KakaoBank in Pangyo, Gyeonggi Province / Newsis By Anna J. Park KakaoBank has drawn over 20 million users since its launch in July 2017, which is nearly 40 percent of the entire 51 million population of Korea.According to the internet-only bank Wednesday, the number of the digital bank's users has grown exponentially every year during the past five years. The bank's user number in December 2017, the first year when it was officially launched, stood at 4.9 million. The number grew to 7.94 million in 2018, 12.4 million in 2019, 15.4 million in 2020 and 17.9 million in 2021. The number finally reached the milestone of 20 million on Nov. 8, which is 1,931 days after the bank began operations.The bank explained that most of the users in the early phase were in their 20s, 30s and 40s. Customers between 20 to 49 years of age constituted nearly 90 percent of total users during the first couple of years following the bank's opening.But the bank continue

Nov 9, 2022By Anna J. Park
KakaoBank draws over 20 mil. users after opening in 2017

Banks face rising CDS premium

Loan products are advertised in front of a sales office of a commercial bank in Seoul, Nov. 6. YonhapBy Lee Min-hyungThe credit default swap (CDS) premiums of commercial banks have soared over the past year due to their weakening credibility in the wake of recent financial scandals sparked by a debt default related to the Legoland Korea Resort in Gangwon Province. The CDS premium is used to measure credit risk. When the figure rises, it indicates a firm's increasing risk of bankruptcy.According to data from the Korea Center for International Finance, the average CDS premium of Korea's four major banking groups ― KB, Shinhan, Hana and Woori ― reached 75 basis points on Nov. 4. This more than tripled as of the end of 2022 when the figure came in at 22 basis points.The CDS premiums of Hana Financial Group and Woori Financial Group rose more sharply than others during the same period. Their CDS premiums came in at 22 basis points by the end of last year, but soared to 77 basis points, respectively, by Nov. 4. That of Shinhan jumped with a similar margin from 24 to 73 basis points during

Nov 8, 2022By Lee Min-hyung
Banks face rising CDS premium

MetLife Korea launches new traditional whole life insurance

MetLife Korea launches a new traditional whole life insurance. Courtesy of MetLife Korea By Yoon Ja-youngMetLife Korea, a leading player in the country's foreign exchange insurance market, has recently launched a new whole life insurance that can be switched to a dollar insurance if certain terms are met. The new product, named “Whole Life Insurance for Million People,” shares the same features and structure with the insurer's hit foreign exchange product, “USD Whole Life Insurance for Million People,” launched back in 2019. This is the first time that an insurance company has launched the same product in two different currencies: the Korean won and the U.S. dollar. Once the premium payment is completed, the surrender value reaches 100 percent (Type 1) or up to 106.3 percent (Type 2) of the base premiums paid. This product carries a rider that allows a policy holder to convert this plan to a U.S. dollar savings insurance, provided that seven years have elapsed after

Nov 8, 2022
MetLife Korea launches new traditional whole life insurance

Heungkuk to exercise call option for hybrid bonds

Heungkuk Life Insurance headquarters in central Seoul / YonhapSouth Korean insurer Heungkuk Life Insurance Co. said Monday it plans to exercise a call option for long-term hybrid bonds issued in 2017, reversing its previous decision to delay the buy-back."We apologize for causing turmoil in the financial market with our previous decision," Heungkuk Life Insurance said in a statement. "We plan to continue to spare no efforts to stabilize the market and protect customers."The company earlier decided to delay exercising a Nov. 9 call option for hybrid bonds worth US$500 million issued in 2017, citing unfavorable market conditions stemming mainly from U.S. monetary tightening.Hybrid bonds, which combine debt and equity features, usually come due in 30 years, but a call option gives the issuer the right of termination before maturity. As the call option date is virtually deemed to be the maturity date of hybrid bonds, Heungkuk's previous announcement hurt investor sentiment on foreign currency-denominated securities sold by South Korean financial institutions, dubbed "Korean papers."Analy

Nov 7, 2022
Heungkuk to exercise call option for hybrid bonds

Korea introduces own container cargo index

Containers are stacked at a pier in Korea's largest port city of Busan. YonhapKorea announced its maiden container freight index Monday to better reflect shipping rates on Asian routes, the oceans ministry said.The Korea Ocean Business Corporation (KOBC) Container Composite Index (KCCI) stood at 2,892 for the second week of November, according to the Ministry of Oceans and Fisheries In July 2020, the ministry joined hands with the state-run KOBC to develop the KCCI to better respond to growing uncertainties from the worsening global supply chain disruptions.The KCCI is based on rates for cargo on 13 routes from Busan, Korea's largest port on the country's southeast coast, to Asia, North America and Europe.The index utilizes freight rates unveiled by shipping companies registered with the ministry and provided by logistics companies, the ministry added.Currently, Korean exporters and importers bank on the Shanghai Containerized Freight Index (SCFI) for data on freight rates. The oceans ministry said the KCCI will be of great help to local shipping companies and trading firms by allowi

Nov 7, 2022
Korea introduces own container cargo index

Financial risks squeeze non-banks, while boosting profits at banks

A signboard directs customers to the personal loan service section at a commercial bank in Seoul, in this photo taken in October 2021. Korea Times fileBy Yi Whan-wooFinancial risks deepened by costly borrowing rates are squeezing non-banking firms, such as brokerage houses and insurers, with liquidity shortages, while the situation doesn't seem all that bad for the banks. The banking arms of the nation's four largest banking groups ― KB Kookmin, Shinhan, Hana and Woori ― posted record net profits of 13.85 trillion won ($9.82 billion) combined for the first three quarters of 2022.Such windfall profits are driven by net interest income, which jumped 21.1 percent from a year earlier to 10.11 trillion won in the wake of the Bank of Korea's (BOK) steep rate hikes.The BOK has delivered rate hikes five times since August 2021, and accordingly, the savings deposits in accounts with more than 1 billion won hit a record 787.9 trillion won as of June.A sharp increase in bank reserves is also attributed to investors' growing preference for safe-haven assets.Although it has returned to 3 percent

Nov 7, 2022By Yi Whan-woo
Financial risks squeeze non-banks, while boosting profits at banks

K bank logs record net profit in Q3

A signboard of online lender K bank is seen on a building in Seoul in this file photo taken in July 2021. Korea Times fileBy Yi Whan-wooOnline lender K bank posted a record net profit of 25.6 billion won ($18.2 million) in the third quarter of this year amid a surge in interest margins, the company announced on Monday.It said net profit for the July-September period was up 52.4 percent from a year earlier and that it remained in the black for the fifth straight quarter.Cumulative net profit for the first three quarters combined amounted to 71.4 billion won, which is up more than eightfold from the same period of 2021.The bank assessed the increased earning is driven by expanded customer benefits in the midst of toughened economic circumstances for retail customers.It noted the number of its customers reached 8.01 million by the end of the third quarter, up from 7.83 million three months earlier.Customer deposits increased by 12.18 trillion won year-on-year to 13.49 trillion won in the third quarter, while lending increased from 8.73 trillion won to 9.78 trillion won during the cited

Nov 7, 2022By Yi Whan-woo
K bank logs record net profit in Q3

Ex-civil servant takes office as leader of insurance development institute

Korea Insurance Development Institute Chairman Heo Chang-eon delivers his inauguration speech at the institute's headquarters in Seoul, Monday. Courtesy of Korea Insurance Development InstituteBy Lee Min-hyungHeo Chang-eon, ex-civil servant at the Financial Supervisory Service, took office as the leader of the Korea Insurance Development Institute (KIDI) on a three-year tenure, Monday. He started his financial career at the Bank of Korea in 1987 and moved to the Financial Supervisory Service two years later. He spent most of his time there before ending his career as a former assistant deputy governor. His career also includes a period as the former chief of the Financial Security Institute. Until last year, Heo worked as an inspection commissioner at Shinhan Bank.The new leader of the institute is known to be close to President Yoon Suk-yeol, studying with him at Seoul National University.“The insurance industry faces a new paradigm amid multiple risk factors caused by internal and external changes in market circumstances,” Heo said in his inauguration address. “We

Nov 7, 2022By Lee Min-hyung
Ex-civil servant takes office as leader of insurance development institute

IBK, BNK set for year-end leadership reshuffle

Industrial Bank of Korea CEO Yoon Jong-won, left, and former BNK Financial Group Chairman Kim Ji-wan / YonhapMajor banking groups expected to focus on stability in year-end reshuffleBy Lee Min-hyungThe Industrial Bank of Korea (IBK) and BNK Financial Group are moving to reshuffle their top management. This will be the first major shakeup in the financial sector as the year-end organizational reform period draws closer. IBK CEO Yoon Jong-won ends his three-year tenure in January 2023. He has expressed his intention of stepping down from the post without extending his term.President Yoon Suk-yeol will appoint the next IBK chief, but it remains to be seen whether another external figure will be selected to lead the bank just as CEO Yoon has been doing for the past three years. Earlier, the union of the lender blocked the CEO's entry into its headquarters, expressing fierce opposition to the former Moon Jae-in administration's parachute appointment.The union has underscored the need to appoint the next IBK leader internally to ensure awareness of the state-run bank's structure and to avo

Nov 7, 2022By Lee Min-hyung
IBK, BNK set for year-end leadership reshuffle

Shinhan cooperates with Visa on data and global business

Shinhan Financial Group Chairman Cho Yong-byoung, left, shake hands with Visa Chairman and CEO Alfred Kelly Jr. on Oct. 17 at the headquarters of Visa in San Francisco, U.S., after signing a strategic partnership on data and global business. Courtesy of Shinhan Financial GroupBy Anna J. ParkShinhan Financial Group and Visa have decided to join hands to cooperate in the area of data utilization and global business.According to the financial giant Sunday, Shihan Financial and Visa agreed to form strategic partnership on data and global business, as the two groups' leaders ― Shinhan Financial Group Cho Yong-byoung and Visa Chairman and CEO Alfred Kelly Jr. ― met in mid-October at the headquarters of Visa in San Francisco, U.S., to sign the partnership deal. With the partnership, Shinhan Financial plans to utilize Visa's global data in developing its new products and services. “Shinhan Financial Group is conducting product and service development and various marketing activities based on data information. We aim to achieve the two companies' mutual growth, as we cooperate on accumu

Nov 6, 2022By Anna J. Park
Shinhan cooperates with Visa on data and global business
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