Astounding Growth of Assets

Woori Bank celebrates phenomenal record on July 16 and shows intentions to expand operations overseas

President Park Hae-choon of Woori Bank announced recently that the bank's total assets have now reached 200 trillion won, in a meeting with the press on the occasion of the first 100 days in office as CEO of the commercial bank on July 18.
The former head of the LG Card, said the bank's total assets reached the level on July 16, becoming the second bank in the country with total assets over that level and the feat is more significant because it was reached without M&As with other financial institutions, but through every employee of the bank working hard to achieve the goal.
He said the bank would have to expand its assets because having a larger market share decreases risk. The CEO said in the second half that Woori would continue to expand its assets by increasing the corporate loans, especially to sound SMEs. He admitted that the bank is still in a difficult situation with the MOU signed with the Deposit Insurance Corp. to improve its management, but would overcome it with a speedy decision-making fast service.
One of his major management plans includes the increased market share from 6 percent to 10 percent for its credit card business under the strategy to expand the profit of the bank's non-banking operation sectors.
He is concerned that the financial supervisory authorities are uneasy for too much competition in the credit card market, but he is not overly concerned with the Woori credit card operation because its default rate stands at only 2.16 percent much smaller than 5 to 10 percent on average for the industry. The credit market is also risky and paid dearly for its lessons the hard way during the financial crisis of 1998.
He also criticized its rival banks law suit against the name of the bank because it means 'our's'sin Korean by saying that the government gave the name to the bank during its restructuring stage and the brand name can only be used by the bank in its products. He said the lawsuit is illegal and also immoral in a business sense, comparing the suit itself to picking fights with the people and the government.
On privatization plans for the bank, he said Chairman Park Byung-won of the Woori Financial Group is thinking hard about the matter. His personal opinion is that Woori Bank should continue to be the only Korean bank not dominated by foreign capital even after its privatization.
He is for the National Pension Service taking over some stake in the bank and allowing industrial companies in consortiums holding up to 4 percent each of the bank's shares.
The Ministry of Finance and Economy in charge of the financial affairs for the government has yet to make a concrete decision on the matter. The CEO expects the ministry would make the decision sooner than later as the Capital Markets Consolidation Act would come into being in 2009.
Woori Bank would set up 30 branches in China by 2010 mainly to secure yuan deposits from Chinese customers, the bank announced recently. The bank plans to set up branches in the cities where Korean businesses are located including Beijing and Shanghai and would launch its private banking service aimed at rich native citizens and Korean businesspeople engaged in business in China. Woori Bank also plans to provide 1 trillion won in loans to innovative-type SMEs on special discounted interest rates, down 0.2 percent from expected rates, along with business consultations. The bank would also give counseling to women CEOs on marketing and networking, especially on tax, legal and real estate matters. The bank would also run educational facilities such as a coaching school and charming school for employees of firms managed by female CEOs. Woori Bank President Park Hae-choon announced the bank's strategies at a lunch he hosted at a downtown Seoul hotel on May 18 where some 200 CEOs of SMES were invited.
Woori Bank, with the registration of its local subsidiary in China this year, aims to put itself in an advantageous position in the retail banking sector in the neighboring country, based on its strategy for avoiding various local regulations for the operation of its wholly-owned local subsidiary.
Kim Dae-shik, chairman of the China Woori Bank establishment committee, said by the end of this year, the local subsidiary would be opened in Beijing by the end of this year and its operation would be limited to securing Chinese currency deposits first. He said the committee got the license from the Chinese monetary authorities and by the end of this year, it expects to get official approval from the Chinese government.
The committee plans to open 2 or 3 branches in Shanghai, along with retail banking units in a number of major cities including Beijing, Qingdao, Tianjin and Nanjin. Kim said the bank would hire local branch managers for its two branches in Shanghai to localize their operations. nw

President Park Hae-choon of Woori Bank.