Korea Exchange Bank (KEB) will once again pursue its overseas expansion policy, a strategy that was suspended for a while when Lone Star was running the bank. KEB has recently opened a branch in Abu Dhabi, the first new overseas branch in a decade.

President Yun Yong-ro was joined by a number of dignitaries including Gov. Sultan Bin Nasser Al Suwaidi of the central bank of the United Arab Emirates (UAE) in Abu Dhabi and Korean Ambassador To the UAE Kwon Tae-kyun at the ribbon cutting for the new branch on Dec. 13, becoming the first Korean bank branch to operate in Abu Dhabi.

When Lone Star, a U.S. hedge fund, took over KEB in 2003, it had 21 overseas branches, now only 12 remain. President Yun promised when he took over as CEO that KEB will relaunch its overseas expansion drive again. The bank will open an overseas rep office this year in Dalian, China, and a branch at Clark Air Force Base in the Philippines, Istanbul, Turkey, and Chennai, India, next year.

KEB has already received approvals for the three new overseas branches to be launched next year from both Korean and financial authorities of the host countries. KEB also plans to open three branches and a rep office in China next year, and a branch in Indonesia, for a total of seven new overseas locations.

KEB officials said the financial market in Abu Dhabi has been in an upsurge with so many Korean construction companies doing business in the Middle East, and the new branch in Abu Dhabi will create synergy with the KEB branch in Bahrain and the rep office in Dubai, already in operation.

The Abu Dhabi branch will boost the number of KEB branches and rep offices to 52 in 22 countries overseas and KEB plans to further expand the number of its overseas branches in the coming days in such regions as the Middle East and Central and South America and other regions where high value-added financial transactions are frequently made. The bank will also refocus its overseas banking strategies in the countries where it used to have a strong presence before Lone Star took over, including the United States, one step at a time, the officials said. 

Korea Exchange Bank recently reported third quarter net income of 125.5 billion won.

Third quarter net income fell by 32.4 billion won or 20.5 percent from the previous quarter’s 157.9 billion won. When compared with the net income of the same period last year (117 billion won), 2012 third quarter net income grew by 8.5 billion won or 7.2 percent.

Although KEB’s loan assets increased, the Bank’s net interest income was 486.5 billion won in the third quarter, down 20.5 billion won or 4.0 percent from the previous quarter’s 507 billion won due to decreased net interest margin following the Bank of Korea’s key interest rate cut.

Non-interest income was 244.5 billion won, up 17.1 billion won or 7.52 percent from the first quarter’s 227.4 billion won. This increase was attributable to the growth of trading profits (38.6 billion won) and securities-related income (8.8 billion won).

Total expenses in the third quarter were 395.3 billion won, up 56.4 billion won or 16.6 percent from the previous quarter’s 338.9 billion won. Total expenses increased mainly due to the seasonal fluctuation in salaries and benefits.

Total loans were 76.5 trillion won in the third quarter, an increase of 2.4 trillion won from the previous quarter’s 74.1 trillion won. Total loans have grown by more than 2 trillion won since the second quarter of this year. This increase is the result of KEB’s enhanced marketing efforts as well as organizational restructuring and increased lending to SMEs amid unfavorable conditions in the industry due to the global financial crisis.