Recent investigations into irregular business practices at South Korea’s Nonghyup Bank underline the challenges that financial regulators face in ferreting out unfair business deals between affiliates of the country’s big financial groups.
The Financial Supervisory Service said on Wednesday it had discovered through a special inspection that Nonghyup extended a loan of Won6.35tn ($5.7bn) to its parent National Agricultural Cooperative Federation in March last year and offered some of the loan at lower interest rates as a favour. Continue reading »
Many Korean banks, hard pressed to find growth at home, have tried to expand into emerging markets across Asia, their main targets due to cultural affinity.
But a decade on after launching aggressive expansion plans, they have struggled to gain a strong presence overseas because of their limited international experience and a lack of an extensive international network. Continue reading »
Grim news for investors in Korean banks: their profitability has fallen to the lowest level since the 2008/09 global financial crisis.
Korean banks reported Won9tn ($8.2bn) in combined net profits last year, a drop of 23.2 per cent from a year earlier, as their net interest margin – a key measure of banks’ profitability – fell to 2.1 per cent, its lowest level of the past decade apart from the crisis years, according to the country’s financial watchdog. Continue reading »
Is South Korea becoming a graveyard for foreign financial firms? Such concerns are growing as an increasing number of foreign financial companies are leaving the country after years of losses, struggling to compete with local rivals. Continue reading »