Center to be bank’s first overseas base under Southern Strategy designed to explore financial market in S.E. Asia, and extend financial services to the fishing industry in Myanmar
President Lee Dong-bin of Suhyup Bank.
“We will set up a base to extend our financial services to the fishing industry in Myanmar next year, which will be the first overseas legal entity for the Suhyup Bank.” declared bank President Lee Dong-bin on Oct. 25, marking the initial year as CEO of the bank.
On the auspicious occasion, he announced his new management plan to establish the bank’s first overseas base in the Southeast Asian country to explore the global financial market as he met the media at the bank’s head office, in Songpa Ward, Seoul.
The bank will kick off its first overseas operation by setting up a small retail financial unit. A group of the bank’s experts visited the S.E. Asian country in the middle of October and met with a number of key financial authority officials. President Lee figures that the bank will be able to kick off its operation in Myanmar in the 3rd or 4th quarter next year, considering the time it takes to get the license and prepare.
Lee said they have a lot to learn from the experiences of other Korean banks already operating in Myanmar under their new Southern Strategy. He thinks Myanmar is the right country for Suhyup Bank to start its overseas operation as the country has long coast lines with lots of fishery resources, and they can use the bank’s abundant fishery finance know-how to speed up the development of that industry.
The CEO also said they would be able to expand the financial network by taking over local banks thru M&As and be able to provide the segregated financial services in cooperation with the Central Fishery Cooperatives Federation which can transfer its advanced fishery technologies to the local fishery community.
The plan was set up by the bank with President Lee’s marketing strategy to consolidate its customer base, leading the bank to improve its operation in the first half this year. H1 net profit rose 37 percent YoY to 164 billion won, the largest H1 net profit in the bank’s history. The ratio of corporate loans and household loans improved, now standing at 6:4 in favor of corporate loans, up from 7:3.
A number of its new financial products with higher interest rates expanded through word-of-mouth marketing among the “2030 generation” especially the products which can be taken out in loans without face-to-face meetings with loan officers. It jayu Installment Savings had its subscribers grow to around 150,000 in just five months. They can use mobile channels such as Kakao Pay and Samsung Pay to get a membership.
President Lee said he was very surprised to meet a customer who came by taxi, although it took about an hour to get here. He was so eager to apply for a membership for the installment savings when he made a call to the Yeochon County branch.
He said truly appreciated the customer’s desire to get a membership for the installment savings account with such a small interest margin for the bank, because the bank develops products like that for the benefit of customers. He will continue to tour branches to encourage staff, and to see if their work load can be eased, he said.
The bank has also been intensively seeking a way out of household loans, which financial authorities are pressuring banks to keep low rates.
He said the bank should focus on three areas to improve its operation; strengthening digitalization, and getting ready to pay back the government funds that the bank got during the financial crisis as early as possible by broadening its profitable operations.
Myanmar is in the early stages of financial reforms which the government has made an economic priority. At present Myanmar’s financial system remains one of the least developed in the world. Myanmar remains a cash-oriented economy. A history of high inflation, bank runs, and insider lending has fuelled public distrust of the banking and financial services industry.
A view of Suhyup Bank in Songpa Ward in Seoul. (Photos: Suhyup Bank)