President Cho Yong-byeong of Shinhan Bank.

Shinhan Bank has been speeding up its overseas operations since March when President Cho Yong-byeong took over as the CEO of the bank by setting up a wholly-owned subsidiary in Mexico. The new president is known for his expertise in international banking.

Cho has been credited with boosting the bank’s overseas earnings by 0.5 percent to 9.2 percent of total earnings in the first half. The bank opened six overseas branches since his takeover as CEO. Before Cho took the helm of the bank, it had been opening three to four new branches overseas annually. 

Shinhan Bank won a license to set up a wholly-owned subsidiary in Mexico from the Mexican financial authorities, CNBV — a first for a Korean bank. The bank plans to launch the subsidiary this year.

Mexico has many foreign companies with operations in the Central American country with a number of key Korean companies among them, including Samsung Electronics, Hyundai Motor and its sister Kia Motors, LG and POSCO. Shinhan Bank’s subsidiary in Mexico will provide financial support to those Korean firms operating in the Central American nation and serve the local community.

Cho has been emphasizing the importance of international finance to the officers and staff of the bank ever since his term began in March. Since May, he has been making tours to a number of the countries including India, Indonesia, China and Vietnam to check on the bank’s operations there. The new CEO plans to boost the overseas operations of the bank with loan interest rates so low in Korea to help expand the bank’s earnings this year. He plans to have the bank’s overseas branches localize operations in line with the trends of the financial markets of the countries they operate in for such areas as organization, commodities, marketing and other areas of operations.

The bank’s international operations have been growing under Cho’s leadership. The six new branches opened under his help are located in China, Vietnam and Indonesia; the bank will soon open branches in the Philippines and Dubai.

Shinhan Bank will have 82 branches in operation in 18 countries by the end of this year; up from 70 branches in 16 countries last year. The bank has also signed a contract to take over a local financial firm in Indonesia. 

Shinhan’s share of earnings from overseas is projected to rise to 10 percent at the end of this year from 9.2 percent in the first half of the year. The bank plans to boost its overseas earnings to 15 percent overall by 2025.

Shinhan is headquartered in Seoul. It was the first bank in Korea, originally established under the name Hanseong Bank in 1897. Relaunched in 1982 as Shinhan Financial Group, it In 1982, Shinhan Bank had capital stock of 25 billion won, 279 employees and three branches. As of 2006, it had transformed itself into a global enterprise, boasting total assets of 176.9 trillion won, equity capital of 9.7 trillion won, 10,741 employees, and 1,026 branches. Total deposits and net income amounted to 105.3 trillion won and 1.4 trillion won, respectively. 

Shinhan Bank is the descendant of Hanseong Bank, the first modern bank in Korea. It was established by Kim Jong-Han in 1897, but began operating around 1900. It was originally located in a small house with only two rooms. One room was for the President Yi Jae-Won, and the other room was for his staff. The bank operated by borrowing money from Japanese banks at low interest rates and then loaning it out for twice the rate in the Korean market. The Bank was successful because, despite lending out money at twice the rate it borrowed it at, the bank's interest rates were still far lower than what could be obtained elsewhere in Korea at that time.

The bank's first property to use as collateral on a loan happened to be a donkey. The bank staff were challenged to feed and care for their collateral as the loan was outstanding.

The Shinhan Financial Group building in Seoul, where its affiliates have their head offices including Shinhan Bank.(Photos:Shinhan Bank)