Korea Exchange Bank (KEB) said on July 1 that it will set up an office in Cirug, Indonesia, to secure a strategic point in the western region of the country.
The planned outlet will bring the bank’s overseas outlets to 54 in 23 countries, four of which are in Indonesia including the operational head office in Jakarta, the Jikarang outlet, the Kulakading outlet, and the new Cirug outlet in Java, which are projected to boost KEB’s operations in Southeast Asia. PT Bank KEB Hana is the name of the wholly-owned subsidiary in Indonesia set up in May to manage KEB’s and Hana Bank’s operations in the Southeast Asian country.
Indonesia, as a strategic location connecting the Indian Ocean and the Pacific Ocean, also has a strong economy as an ASEAN country and saw its economy grow by 6.2 percent last year, despite the global economic slowdown.
The country also has a strong domestic market with a population of 250 million and abundant natural resources, as well as great potential for future growth in the next 10 years. The country is also a member of CIVETS, six nations with high growth potential, which includes Columbia, Indonesia, Vietnam, Egypt, Turkey and South Africa.
Cirug is located some 30 km west of Jakarta, with some 200 Korean firms doing business there including footwear makers, textile plants, and others. POSCO is ready to complete its steel plant in nearby Jilekon at the end of this year, with more Korean firms set to relocate to the area.
President Cho Yong-woo of KEB Indonesia said the Cirug outlet will provide financial services to Korean firms and residents in the western regions of Indonesia aa well as Korean firms planning to relocate to the area in the future, giving them all kinds of guidance including financial services in order for them to settle down as soon as possible.
In the meantime, KEB has concluded an overall cooperation agreement with Korea Housing Guarantee Corp. (KHGC) on June 5 to revive the real estate guarantee financial products and stir up the sagging real estate market in Korea, particularly the housing market, to bring stability to residential housing conditions around the country.
KHGC will issue special guarantees for home buyers, while KEB will provide new financial products and special loans such as loans for housing rentals and house purchases, expanding its financial support to the housing guarantees issued by KHGC.
Under the agreement with KHGC, KEB will be able to extend financial coverage to all the guarantees provided by KHGC for the purchase of houses and financing of rentals including those to be issued in the future. The bank will continue to develop new financial products to perk up the real estate market jointly with KHGC to bring stability to the housing market in support of the government’s policies.
President Yun Yong-ro of KEB said the agreement signals a win-win situation between KEB and KHGC, the two main players in the housing market, in further expanding their traditional roles with KHGC providing guarantees for the rental and purchase of houses and KEB providing financial products to cover those guarantees to keep the housing market booming.
President Kim Sun-kyu said the agreement will create synergy between the two major players in the housing market as KEB’s highly efficient financial system and KHGC’s know-how on issuing guarantees on housing rentals and purchases would go hand-in-hand, providing benefits to families with modest incomes. “We should work together to help each other grow further, building a mutual partnership,” Kim said.