Korean banks enjoy robust earnings in Asian emerging markets

Four major banks in South Korea are enjoying healthy earnings from overseas businesses, particularly in Asian emerging markets.

KEB Hana Bank posted 404.9 billion won ($307.9 million) in net profit from overseas business for the first three quarters of this year, according to its regulatory filings. It outperformed the other three big players in Korea – Shinhan Bank, Woori Bank and KB Kookmin Bank.

Hana will strengthen its competitive edge in overseas operations and global investment banking services, while expanding its presence in India and central Europe, said Chief Global Strategy Officer Hwang Hyo-goo.

Some 19.5% of Hana’s overseas net profit is from Vietnam. The bank bought a 15% stake in Bank for Investment and Development of Vietnam (BIDV) at 1 trillion won in 2019 and has seen the equity value soar nearly 50%.

Shinhan ranked second with 401.5 billion won net profit from overseas business from January to September. Its earnings in Vietnam and Kazakhstan rapidly increased from a year ago.  

The bank’s Vietnamese operations posted 184.7 billion won net profit for the three quarters, up 27.6% on-year. Since opening its first unit there in 2009, Shinhan has provided retail banking services like mortgages and personal loans and is expanding its presence in corporate finance and fintech.

Shinhan’s net profit from Kazakhstan reached 44.7 billion won during the same period, eight times from a year ago. The Kazakhstan business focuses on project finance for Korean construction firms operating in the central Asian country and retail banking for locals.

Woori ranked third with 256.9 billion won net profit from overseas operations. It aims to earn 25% of total net profit from overseas by 2030, spurring business in Vietnam, Indonesia and Cambodia.

KB Kookmin logged 147.5 billion won in overseas operation net profit for the same period, seeing a sharp increase in its banking units.

The overseas banking units posted 81 billion won in net profits in the three quarters, nearly tripling from a year ago.

The bank’s Chinese banking affiliate, which had an 8.2 billion won loss in the whole year of 2022, generated 25.1 billion won in net profit for the three quarters.

On the other hand, its Indonesian unit Bank KB Bukopin saw a 95.8 billion won loss from January to September, compared with a 150.5 billion won deficit for the same period of the last year.


Write to So-Hyun Lee and Bo-Hyung Kim at y2eonlee@hankyung.com
 
Jihyun Kim edited this article.