Business - The Korea Times

Loans for African importers

Export-Import Bank of Korea (Eximbank) CEO Bang Moon-kyu, left, poses in front of a screen showing Eastern and Southern Africa Trade and Development Bank (TDB) President Admassu Tadesse at Eximbank's headquarters on Yeouido, Seoul, Tuesday. The two institutions signed an agreement in an online meeting for Eximbank to provide $100 million in loans to TDB to offer to importers of Korean products in Africa. / Courtesy of Eximbank

Jul 15, 2020By Kim Bo-eun

Digital literacy core factor for promotion at Shinhan

Shinhan Financial Group Chairman Cho Yong-byoung speaks in a seminar at its training center on Jan. 2. YonhapBy Lee Min-hyungFinancial firms worldwide are promoting their visions for digital transformation to brace for the post-coronavirus era.Korean financial players are also embracing the change, claiming a new era of digitization will offer fresh chances for them to seek a breakthrough amid the structural slowdown in the financial industry.Despite their years-long hype to follow the vision, most of the leading financial holding firms have yet to bring visible results in their digital drives.But the mood is shifting rapidly in financial circles here, with the COVID-19 pandemic creating a heightened sense of crisis by paralyzing traditional economic activities here and abroad. Shinhan Financial Group, one of the nation's biggest financial holding firms along with KB Financial Group, is particularly eager to embrace digital transformation in a timely manner.“We are going to evaluate the digital literacy of our affiliates for the latter half of 2020, as part of a test operation

Jul 15, 2020By Lee Min-hyung

Digital literacy core factor for promotion at Shinhan

Myanmar rising as strategic location for banks

Staff of Shinhan Bank's branch in Yangon, Myanmar, address customers in this photo provided by Shinhan Bank. / Courtesy of Shinhan BankBy Kim Bo-eunBanks are expanding their presence in Myanmar, as they seek new opportunities in the fast growing Southeast Asian country.Myanmar is drawing the attention of financial firms, as a rising economy which has recorded an average of 7 percent GDP growth since 2012, and has a young working population.Nonghyup Bank is preparing to expand its existing presence, to offer specialized services in agricultural finance. The lender said last week it acquired approval from local authorities to set up an office in Yangon.The bank has been offering micro financing services via its subsidiary Nonghyup Finance Myanmar since 2016. "Setting up an office paves the way for us to set up a branch as well as a subsidiary," a Nonghyup Bank official said.While he said plans have not yet been specified as the lender is currently in the stage of setting up an office, Nonghyup is seen to be planning to begin a banking business there, based on its area of expertise.Nong

Jul 15, 2020By Kim Bo-eun

Myanmar rising as strategic location for banks

Are Tehran's demands unreasonable?

From left: the Industrial Bank of Korea headquarters in Seoul, Iranian President Hassan Rouhani, and the Woori Bank headquarters in Seoul / Korea Times fileWoori, IBK silent on Iranian government's threatsBy Park Jae-hyukThe Iranian government's attempt to regain access to its oil export revenue, which was seized in Korea amid Washington's economic sanctions, is leading to concerns that the situation could develop into a legal battle for Woori Bank and the Industrial Bank of Korea (IBK), both of which have taken charge of the Middle Eastern country's frozen accounts here.But the Korean banks have remained silent about possible threats from Tehran, apparently being cautious about possible involvement in a diplomatic tussle with both Iran and the United States. Sources familiar with the issue blame Iran, claiming Tehran was making “unreasonable demands and false claims” as the pandemic is increasingly weighing on its economy amid the intensifying U.S. sanctions.The Tehran Times was the first to report that the Iranian government is considering filing lawsuits against the Ko

Jul 14, 2020By Park Jae-hyuk

Hana may face another setback for 'misselling' of risky fund

Victims of a redemption fiasco by Lime Asset Management hold a rally in front of Shinhan Financial Group headquarters in central Seoul on July 10. Shinhan Investment and Shinhan Bank engaged in mis-selling of the risky fund products to investors. YonhapBy Lee Min-hyungHana Bank, NongHyup Bank and Shinhan Bank ― three major retailers of a trade finance fund managed by a Korean fund operator ― are in growing anxiety over the potential suspension of the financial product's redemption. The concern comes as Fidelis Asset Management failed recently to pay early redemption fees over the fund sold by Hana Bank. The lender sold the fund worth 28.3 billion won ($23.44 million). The fund reached maturity at the end of May 2020. But with Fidelis suspending the early repayment of the fund, its expiration date will be delayed by six months to the end of November.“The coronavirus outbreak delayed the redemption plan,” a spokesman at Hana Bank said, declining to comment further.This is putting an additional burden on the already-dismal fund market, here, after the “Lime fiasco,&rdq

Jul 14, 2020By Lee Min-hyung

Hana may face another setback for 'misselling' of risky fund

Lina fined for tardy insurance payment

By Kim Bo-eunLina Korea CEO Benjamin Hong.The country's top financial regulator has fined U.S. insurer Cigna's Korean subsidiary, Lina Korea, for being late in its insurance claims payouts.The Financial Supervisory Service (FSS) notified Lina Korea, July 8, of the 12 million won fine imposed for making payments on two insurance claims 17 and 28 business days, respectively, after the final dates the payments were due in 2018.The policy terms stated that Lina had been required to make the payment within 30 business days of the claim being filed. The FSS imposed the fine because Lina failed to make the payments within the specified time.A Lina Korea official said, “Out of 250,000 late payments that were made collectively by insurers, we only account for two.” He did not specify why the payments were delayed, and said Lina would pay the fine. Payment delays generally occur when claims are suspected to be fraudulent, or when it takes time to determine whether or not the policyholder should receive the payment based on their medical history, or when there is a problem with docu

Jul 14, 2020By Kim Bo-eun

Strengthening mobile banking services

NongHyup Bank Chief Digital Officer Lee Sang-rae, fourth from left, holds a signed MOU with company officials as well as fintech company ATON CEO Kim Jong-seo, sixth from left, at the NH Digital Innovation Campus located in southern Seoul, last Thursday. The two companies, together with major mobile carriers LG U+ and SK Telecom, vowed to cooperate to provide better mobile banking services to customers. / Courtesy of NongHyup Bank

Jul 13, 2020By Anna J. Park

Lenders to tighten rules against default risks

People seeking to take out loans sit in front of tellers at a bank in Seoul, in this file photo. Korea Times fileBy Lee Kyung-minCommercial banks are rushing to impose stricter lending rules following a spike in credit-backed borrowing from individuals and low-income businesses run by the self-employed, in a precautionary measure to rein in default risks triggered by the economic crisis amid the spread of the COVID-19 pandemic.The collective move is explained by a drop in delinquency rates in June from a month earlier, a statistical illusion created due to a spike in loans taken out from stock investors and mortgage seekers amid the record-low borrowing rate.Experts say the rapidly rising debt not backed by strong economic recovery in sight will be a “ticking time bomb” that will hit the fiscal soundness of lenders whose financials will tank once repeated delinquency rates develop into full-fledged defaults.The country's top five banks ― KB Kookmin, Shinhan, Hana, Woori and NongHyup ― have initiated strengthened measures to monitor and manage high-risk borrowers and at-ri

Jul 13, 2020By Lee Kyung-min

Lenders to tighten rules against default risks

Financial regulator targets Meritz, Kyobo Life

By Kim Bo-eunMeritz Fire & Marine Insurance's headquarters in southern SeoulThe Financial Supervisory Service (FSS) is zeroing in on insurers over hiking insurance premiums as well as other issues.The financial regulator last month looked into non-life insurers to check their damage inspection fees, which are a key element in calculating insurance premiums, after Meritz Fire & Marine Insurance were found to have excessively raised the fee.The hike came at a time when other non-life insurers raised their insurance premiums. Meritz did not raise its insurance premium, but increased the damage inspection fee instead.The damage inspection fees of major non-life insurers ― Samsung Fire & Marine Insurance, Hyundai Marine & Fire Insurance, DB Insurance and KB Insurance ― stand at 3 percent to 3.8 percent. This is a 1 percentage point hike from the previous year. Insurers change the rate in April or October every year.Meritz, however, was found to have raised its damage inspection fee multiple times, and applied a different rate for different policies. The rate for its long-t

Jul 13, 2020By Kim Bo-eun

Financial regulator targets Meritz, Kyobo Life

'Financial firms should partner with new sectors for survival'

Boston Consulting Group (BCG) Managing Director and Partner Kim Yunjoo speaks during an interview with The Korea Times at BCG's office in central Seoul, June 29. / Korea Times photo by Choi Won-sukBCG partner says financial groups should also play social roleBy Kim Bo-eunFinancial firms, especially banks, are facing one of their most challenging times in the COVID-19 period. The pandemic has further brought down already low interest rates, and platforms created by tech companies are expanding their presence rapidly."This is not a matter of what kind of new businesses banks should come up with. Banks currently face a groundbreaking shift," Kim Yunjoo, managing director and partner at Boston Consulting Group, told The Korea Times in an interview last month."Money is flowing to securities firms from banks based on zero percent interest rates. The shift to financial platforms, meanwhile, is accelerating," he noted.The consultant said circumstances are requiring banks to change the way they conduct business, as they will likely lose competitiveness if they stick with their current busines

Jul 12, 2020By Kim Bo-eun

Banking & Finance