KDB Daewoo Securities - Leaping to Become Asia’s Pioneer IB

KDB Daewoo has the longest history in regards to overseas financial services among Korean financial institutions. It obtained approval for overseas business from the Ministry of Finance in June 1984, the first among local financial institutions, and opened an office in Tokyo two months later. In September 1997, KDB Daewoo established a subsidiary in London, also a first among Korean securities companies. Since then, it has expanded its subsidiaries to New York (1992), Hong Kong (1994) and Singapore (2012), thus leading the Korean securities houses’ business expansion towards the global market. It also opened an investment advisory company in Beijing late last year.

KDB Daewoo continues to explore overseas markets using a differentiation strategy designed by region. It plans to expand traditional corporate finance, trading and brokerage in Asian emerging economies, and strengthen its Principal Investment (PI) and Private Equity (PE) businesses in European countries and the US. Furthermore, it expects a maximum synergy effect through collaborative efforts with its affiliate Korea Development Bank (KDB), thus creating more opportunities for loan arrangement, PI and PE.

In 2012, KDB Daewoo decided on a capital increase for its Asia-Pacific headquarters in Hong Kong, raising the capital size to 300 million US dollars in May. This has made it possible to strengthen its profit-making structure through the operation of source assets, and the trading of Korean securities and investment banking (IB) on a larger- scale. In addition, with increased capital, the Asia-Pacific headquarters is going to expand the size of its foreign-currency assets and meet increasing customer demand for the foreign currency financial instruments. KDB Daewoo will add momentum to efforts to explore overseas markets by upgrading its stronghold in Hong Kong to the rank of international headquarters.

The recently-opened investment advisory company in Beijing is now widening its business scope in cooperation with existing offices in Beijing and Shanghai; from traditional business areas such as Chinese companies’ initial public offerings (IPOs) in Korea and qualified domestic institutional investor (QDII) business to various cross-border financial advisory services for investment into Korean companies, Korean companies’ establishment of joint-ventures in China, and the like.

KDB Daewoo also established a subsidiary in Singapore in September this year as well as created a brokerage business there. It plans to grow this firm into a business center of the Chinese economic zone formed in Southeast Asia, and utilize it as another bridgehead to the entire Asian market, along with its headquarters in Hong Kong.

In Indonesia, KDB Daewoo began buying shares of a local securities company “e-Trading Securities” in September 2007 (current share 38.35%). Since then, it has provided the firm with advanced business technology and know-how, making it the No. 1 securities firm in Indonesia.

For successful overseas market exploration, KDB Daewoo believes it is essential to cooperate with KDB Financial Group, which has a powerful overseas network, and maximize the synergy effect. In particular, Korea Development Bank (KDB) has a sharp competitive edge in PF and M&A. As a result, KDB Daewoo plans to join hands with KDB in exploring overseas markets and actively enhance the synergy effect through PI and PE businesses and loan arrangement. KDB Daewoo aims to raise its proportion of overseas businesses (currently 4%) to 10% by 2015.

In regards to social contributions, KDB Daewoo has created an organization for voluntary social work, named “Social Contributors” in order to realize a prosperous community-based society, something quite different to paying back part of the company’s earnings to society. This form of social contribution includes overseas activities such as supporting poor countries in Africa and disaster areas, which will also help improve Korea’s image in the international community.