Banks preparing to go to North Korea on peace mood

By Nam Hyun-woo

KB, Shinhan, Woori and other commercial banks are paying keen attention to the progress of the amicable South and North Korean relations, preparing themselves to resume halted businesses in the North as soon as possible.

According to the banks on Tuesday, Woori Bank and NongHyup Bank are monitoring the United Nations' movement as its sanctions are one of few remaining obstacles before they can resume business in the North.

Woori Bank opened a branch in the Gaeseong Industrial Complex in 2004 and had been providing services to 123 companies in the South-North industrial zone with seven staffers staying there.

It closed in April 2013 due to the North's nuclear test that year, but went back into operation five months later. It shut down again in February 2016 because of the South Korean government's decision to close the complex and has moved into the Woori Bank headquarters in Seoul to support the companies that were in the complex.

According to Woori, it still has financial records at the complex and has retained its staff, so it can reopen the branch as soon as authorities allow.

“Though there are remaining issues such as the U.S.-North Korea talks and the United Nations sanctions, we can come back to the complex when companies start to resume business,” a Woori Bank official said. “If the complex expands as planned, the economic cooperation between the South and the North will expand and the branch can serve more roles.”

NongHyup Bank has also suspended a branch at the Mount Geumgang resort. The branch was established in August 2006 and started operations four months later with six staffers.

The branch mostly provided exchange services for tourists there, as well as offering deposits and lending for South Koreans staying there for business.

The branch closed in July 2009, as South Koreans' tours came to a halt in 2008 after a North Korean soldier shot dead a South Korean tourist for wandering into an off-limits zone.

“The branch is not closed, but its operation is halted and we are ready to reopen it when the tours to Mount Geumgang resume,” a NongHyup Bank official said.

Though banks are gearing themselves up for resuming their North Korea businesses, other financial firms are not as active.

Three credit card issuers _ KB Kookmin, KEB Card (now KEB Hana Card) and BC Card _ provided credit card services in tourist sites around Mount Geumgang, but they are yet to look into resuming business there.

“It seems to be too early to talk about resuming credit card services in the area and there is yet to be an atmosphere of talking about the issue among credit card companies here,” an industry official said.

Brokerages are also in a similar situation. Though a number of securities firms, including Korea Investment & Securities, have held North Korea seminars for institutional investors, they are yet to have an analyst specializing in the North Korean economy.