Chairman Yoon Jong-kyoo of KB Financial Group.

KB Kookmin Bank eyes expansion overseas through strengthened ties with banks in Southeast Asia, officials of the bank said on April 31. 

They said the bank will provide financing and IT to CHDB in Myanmar to help build residential houses in that country through cooperative ties with local banks to spur its advancement into S.E. Asian countries.

At the same time, the bank is considering turning its office in Mumbai, India, into a branch. The same could happen at its office in Hanoi, Vietnam.

The bank opened a branch in Shanghai last December, which was the 5th business facility for the Kookmin Bank China Ltd., which operates branches in such Chinese cities as Guangzhou, Harbin, Suchow and Beijing.

They said Shanghai has had an international free trade zone since 2013, playing the role as an economic workhorse since then. Trade between Shanghai and Korea amounted to $25 billion in 2014 and financial transactions connected with that trade have also been growing, they said.

The KB China Desk has been rendering its services to Korean firms in Korea and China, and is preparing to open extend their operations in China in such matters as local laws and regulations, administration, taxes and other necessary services. The desk has also been providing necessary funds for Korean firms to settle down in China, offering to help them manage their cash flows, and offers other tailor-made financial services.

KB Kookmin Bank has also been providing its support to the various development projects and social services in emerging countries through an MOU it signed with KOICA for cooperative ties. 

The bank has offered financial support to various infrastructural projects such as the construction of roads, railroads, and airports in emerging nations which KOICA is to undertake. The bank also plans to lend its know-how on financing for residential housing complexes and municipal development projects that KOICA is to undertake in foreign countries.

KB Kookmin Bank is pushing into the global investment banking (IB) market, which is considered an impregnable area for domestic commercial banks. This is a game changer for the bank, which is reckoned to fall rather behind in global competence. Also, the bank will rearrange its overseas network, which is its foothold to tap into the global IB market. At the time when most banks are trying to change their foreign branches into corporations, Kookmin Bank is planning to break into the market through its “inverse thinking strategy,” to switch its corporations in Hong Kong and the U.K. over to branches.

According to financial industry sources, Kookmin Bank is currently discussing overseas expansion plans with the Export-Import Bank of Korea and Korea Trade Insurance Corporation, with the aim of making inroads into the global IB market next year. The bank is planning to first enter the markets of neighboring jurisdictions in which it is relatively easy to analyze the market, such as Hong Kong, China, and Vietnam. It will then gradually expand the markets to other countries. Currently, the bank has sent out the employees of its IB division to its corporation in Hong Kong, and is conducting market research there.

Moreover, the bank is trying to cooperate with international organizations. Kookmin Bank is seeking various plans for overseas market invasions, including signing MOUs with Asian Development Bank (ADB) and International Finance Corporation (IFC) under the World Bank. The bank’s team in charge of IB contacted Jin Liqun, the president-designate of the Asian Infrastructure Investment Bank (AIIB), who visited Korea for two days from Sept. 8.

An official from Kookmin Bank said, “We are discussing measures to tap into the global IB market with policy financing institutions, and appreciable progress has been made in the work. Since the big market has been steadily opening in the overseas IB market, including the launch of the AIIB, we have no choice but to put efforts into the overseas market expansion.”