Overview of Banks in South Korea

As per Moody’s Investment Services, the Korean banking system does not look promising. They have given a negative rank to the Korean banking system. And they have also mentioned that things will deteriorate in the next 12-18 months. The main reason is that Moody thinks it will soon reduce the banks’ creditworthiness.

There are a few important reasons for this negative outlook: –

  • The local consumer sentiment is pretty weak towards the banking system. The policy risk is also one of the main reasons for Moody’s negative viewpoint toward the Korean banking system since May 2016.The growth of real GDPReal GDPReal GDP can be described as an inflation-adjusted measure that reflects the value of services and goods produced in a single year by an economy, expressed in the prices of the base year, and is also known as “constant dollar GDP” or “inflation corrected GDP.“read more is also tepid.

Structure of Banks in South Korea

There are around 148 banks that are licensed in South Korea.

These banks can be divided into three broad categories: –

  • Commercial banks: 52 commercial banks serve local customers in South Korea.Specialized banks: Only five specialized banks provide services to a niche segment of customers.Mutual savings banks: There are 91 mutual savings banks in South Korea, the maximum among all.

Financial Supervisory Services (FSS) regulate and control the banks. The Bank of Korea acts as the country’s Central Bank, which issues Korean Won and maintains price stability.

List of Top 10 Banks in South Korea

  • KB Kookmin BankShinhan BankNonghyup BankHana Financial GroupKorea Development BankWoori BankIndustrial Bank of KoreaDGB Financial GroupKwangju BankBusan Bank

Here is a brief description of each of these banks in detail (source: Relbanks) –

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#1. KB Kookmin Bank:

KB Kookmin Bank is a subsidiary of KB Financial Group. It is one of the top banks in South Korea. It was founded in 1963, around 59 years ago. Its headquarters is located in Seoul. It has over 1,100 branches across the country, serving about 30 million customers. It also has 3,000 ATMs all over the country. At the end of June 2017, the total assetsTotal AssetsTotal Assets is the sum of a company’s current and noncurrent assets. Total assets also equals to the sum of total liabilities and total shareholder funds. Total Assets = Liabilities + Shareholder Equityread more acquired by the KB Kookmin Bank were 422.249 trillion KRW.

#2. Shinhan Bank:

Shinhan Bank is one of the top banks in South Korea. It was established in the year 1982, around 35 years ago. About 13,400 employees work here. They have a presence in over 19 countries. Only in South Korea, Shinhan Bank has over 900 offices. Shinhan Bank is the main subsidiary of Shinhan Financial Group. At the end of June 2017, the total assets acquired by Shinhan Bank were 413.911 trillion KRW. Its headquarter is also located in Seoul.

#3. NongHyup Bank:

NongHyup Bank (NH) is the subsidiary of NongHyup Financial Group. It was established in 2012, 10 years ago. NongHyup Financial Group is owned by the National Agricultural Cooperative Federation (NACF). NH Bank has around 1200 branches in South Korea, focusing on commercial banking services. At the end of June 2017, the total assets acquired by NongHyup Bank were 381.600 trillion KRW. The headquarters is also located in Seoul.

#4. Hana Financial Group:

Hana Financial Group was established in 1967, around 55 years ago. It is the fourth-largest commercial bank in South Korea. At the end of June 2017, the total assets acquired by this bank were 349.045 trillion KRW. Its head-quarter is also located in Seoul. Around 21,700 employees are employed in the Hana Financial Group. It operates through a whopping 1,100 branches in South Korea and 150 in 24 countries.

#5. Korea Development Bank:

Korean Development Bank (KDB) was established in 1954, around 68 years ago. There are approximately 3,200 employees as of Dec 2018 that work in KDB. The headquarters of KDB is located in Seoul. KDB has a network of 80 domestic branches. It is one of the top banks in total assets acquired. We found out from the last data that KDB has obtained around $233.9 billion of total assets as of Dec 2018.

#6. Woori Bank:

It is one of the largest banks in terms of total assets acquired. As of 2019, the total assets acquired by this bank were 361,981 billion. The headquarters is also located in Seoul. It is quite an old bank. It was established in the year 1899, around 123 years ago. It serves about 21 million customers and has a network of 1,000 domestic branches. Woori Bank has the largest global network among all Korean banks.

#7. Industrial Bank of Korea:

The Industrial Bank of Korea (IBK) is to help develop small and medium-sized enterprises. The Government of South Korea owns a major stake in this bank, around 57.7%. This bank is one of the top banks in South Korea. At the end of June 2017, the total assets acquired by this bank were 257.482 trillion KRW. If we consider small business loansLoansA loan is a vehicle for credit in which a lender will give a sum of money to a borrower or borrowing entity in exchange for future repayment.read more, 81% of these loans are offered by the Industrial Bank of Korea.

#8. DGB Financial Group:

DGB Financial Group is one of the largest regional financial institutions in South Korea, established in 2011, just 11 years ago. Daegu Bank is the flagship company of DGB Financial Group, one of the largest regional banks. Its headquarters is located in Daegu. And it serves most of the customers in the Daegu-Gyeongbuk region. In addition, it is one of the significant South Korean holding companies. At the end of June 2017, the total assets acquired by this bank were 56.870 trillion KRW.

#9. Kwangju Bank:

Kwangju Bank was established in 1968, around 54 years ago. The main focus of Kwangju Bank is to provide financial aid to local small and medium-sized business owners. About 1,500 employees work in Kwangju Bank. The headquarter of this bank is located in Gwangju. At the end of September 2014, the total assets acquired by this bank were 17.432 trillion KRW. It was previously known as the KJB Financial Group.

#10. Busan Bank:

This bank is one of the most popular local and top banks in South Korea. It is more of a regional bank than a global bank. However, it provides a wide gamut of financial services to local customers. Financial products and services are limited to personal banking. Busan Bank has a great list of shareholders helping it grow gradually – Lotte group, Capital Research & Global Investors, Templeton, National Pension Service, Aberdeen Asset Management Asia, etc.

This article is a guide to Banks in South Korea. We provide an overview of the top 10 best banks in South Korea, their structure, and their financial status. If you are looking forward to making a career in banking, then you can check out some of the awesome resources: –

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