By Nam Hyun-woo
Dutch-based global financial group ING said Wednesday it had obtained a securities branch license from Korea’s financial authorities, making a comeback to the country after an eight-year hiatus.
The entry is drawing keen interest because the move contrasts with the current trend of foreign financial firms withdrawing from Korea in recent years. This is the first case of a foreign securities firm making a Korea entry since 2013, when Malaysia-based CIMB Group began investment banking and brokerage businesses here.
ING said in a statement that the Financial Services Commission (FSC) granted it a license for a securities branch in Seoul and the branch, located at the Seoul Finance Center in Jung-gu, Seoul, will begin operations immediately.
ING established a branch in Seoul 25 years ago, but pulled out its securities business in 2008 in the wake of the global financial crisis.
The new branch will focus on offering capital market products to corporate clients and financial institutions, ING said. The branch reportedly set up capital of 150 billion won.
“Korean companies have been expanding and we have seen a growing demand from them for European and U.S. assets in the current low interest rate environment,” said Hyun Jong-hoon, ING Korea country manager. “I am confident this expanded capacity, together with our commercial banking activities at the branch, will better fit our clients’ needs.”
The group has appointed Son Young-chang as the ING Seoul Securities Branch Manager. Son was managing director of financial markets at the ING Bank Seoul branch.
The reopening comes amid foreign financial firms’ moves to reduce their presence in Korea in recent years.
Last year, Royal Bank of Scotland (RBS) withdrew its corporate banking business from Korea. Barclays closed its Seoul bank and securities offices this year, while Goldman Sachs and UBS gave up its license in the banking sector. BOS Securities Korea, an affiliate of OCBC Bank Singapore, also decided to withdraw from Seoul in April. Allianz also sold its life insurance unit in Korea to Anbang Group of China.
In the wake of the withdrawals, the FSC expressed concerns in July. “Changes in management strategies, a timid outlook on profitability and stricter global financial regulations are believed to be behind most of the moves, but as Korea's regulator, the FSC has to look at whether Korea's financial environment lags behind that of global standards,” FSC Vice Chairman Jeong Eun-bo said at the time.
Remko Witteveen, regional head of financial markets Asia at ING Wholesale Banking, said, “This new branch in Korea is in line with ING’s ambition in Asia to strengthen relationships with our existing Korean clients and expand our client base.”