The number of overseas branches of South Korean financial companies totaled 437 in 2018, up six from a year ago, according to a recent survey.
The Financial Supervisory Service (FSS) announced on May 23 that the number of South Korean financial firms’ overseas branches came to 437 in 43 countries last year.
Fifteen more overseas branches were opened, while nine were closed down. In short, a total of six were added. The new branches were opened mainly in Cambodia, Myanmar, Vietnam and Indonesia.
Woori Bank, Daegu Bank, Nonghyup Bank and Kookmin Card established a local subsidiary in Cambodia, while the Industrial Bank of Korea opened an office in that country. In Myanmar, Mason Capital set up a local subsidiary and Shinhan Card opened an office.
Among investment banks, Korea Investment & Securities and Mirae Asset Daewoo established a local subsidiary in Indonesia and Singapore, while Kiwoom Asset Management opened its office in Vietnam.
In addition, Woori Bank set up a local subsidiary in Germany, Mirae Asset Daewoo in the United States and Rhinos Asset Management in Mongolia. Kookmin Bank opened a branch in the United Kingdom, while the Export-Import Bank of Korea opened an office in Bangladesh.
Total assets of overseas branches came to US$179 billion (212.87 trillion won), up US$21.80 billion (25.92 trillion won), or 14 percent, from a year earlier. The United States had the highest figure with US$61 billion (72.54 trillion won), followed by China with US$32.50 billion (38.65 trillion won) and Hong Kong with US$17.90 billion (21.29 trillion won).
The net profit of overseas branches grew US$349 million (415.07 billion won), or 37 percent, to US$1.28 billion (1.53 trillion won). This was because financial companies expanded their business portfolios to investment banking and prime brokerage based on capital expansion and workforce reinforcement.
An FSS official said, “Overseas branches have increased operating assets mainly in the Southeast Asian countries, including Vietnam and Indonesia, as profitability is high there. The return on assets (ROA) was 2.0 percent in Vietnam, 1.4 percent in Indonesia and 1.3 percent in Hong Kong, surpassing the ROA of domestic banks at 0.6 percent.”