NH Nonghyup Bank is making a foray into overseas markets by combining commercial finance and agricultural finance based on its expertise in agricultural finance.
NH Nonghyup Bank is currently operating two branches, two offices and one corporation in five overseas countries and has resident officers in three other countries.
The two branches are being run in New York and Hanoi, the two offices are located in Beijing and New Delhi and Myanmar is home to the one corporation (Nonghyup Finance Myanmar). There are also NH Nonghyup Bank representatives in Indonesia, Cambodia and Hong Kong.
NH Nonghyup Bank has recently advanced into Cambodia and is expected to finalize the acquisition of local micro-credit institutions in the first half of the year. In addition, a branch office will be set up in India. NH Nonghyup Bank will also branch out to Vietnam and China.
Compared to other banks, NH Nonghyup Bank was late in making inroads into overseas markets. It needed strategies of its own because it could not have competiveness as a latecomer by simply following other banks’ approaches and business models.
In this regard, NH Nonghyup Bank has formulated a strategy based on commercial finance combined with agricultural finance. It seeks to build an agricultural finance super grid in Southeast Asia based on its expertise in agricultural finance. Strong in agricultural finance, the bank focuses on agricultural countries with great growth potential in Southeast Asia.
NH Nonghyup Bank is continuing its efforts to establish business models that would guide it in the medium to long term.
The National Agricultural Cooperatives Federation, from which NH Nonghyup Bank was separated, has rich practical know-how in the agricultural sector. It has expertise such areas as helping farmers break free from the vicious cycle of usury, providing support to farm households and building systems for production, distribution and sales of agricultural products.
In fact, when NH Nonghyup Bank established a corporation in Myanmar, the local municipal government highly appreciated the bank’s expertise and know-how in agricultural finance in Korea and approved its application for business in the shortest time among Korean financial institutions. This year, the second year of NH Nonghyup Bank’s business operations in Myanmar, the number of customers surpassed 20,000, indicating the bank’s rapid growth. In the future, NH Nonghyup Bank is considering the integration of agriculture-related projects which the bank can successfully carry out, such as provision of financial services to help farmers buy farming machines.
In particular, NH Nonghyup Bank is expected to complete the acquisition of local micro-credit institutions in Cambodia within the second quarter of this year. Cambodia is an agriculture-oriented country devoid of a secondary industry. The nation has a large cultivable area, abundant water resources and great potential for agricultural production.
By making good use of these characteristics, NH Nonghyup Bank will expand its business base through an entry into financial services for ordinary people and farmers, linking the financial, production and distribution business such as the agricultural machinery business, agricultural material sales and the construction of agricultural distribution networks.
Moreover, NH Nonghyup Bank is pushing to establish a branch in India, which is regarded as the center of global economic growth, this year, while studying business models that match the characteristics of Vietnam and China.
NH Nonghyup Bank believes that if it establishes business models that can accelerate not only its own growth but the development of host countries, it will be able to expand its business areas not only to Southeast Asia but also to other regions in the future.