Hana Focuses On China

Pres. Kim outlines aggressive strategy for Hana Bank to expand operations

President Kim Jong-yol of Hana Bank said the bank will compete by providing better customer service in the banking sector in China as interest rates are fixed by the government, limiting the areas in which foreign banks operating in China can compete.
He said he believes the bank will offer top consulting services to its asset management customers on a timely basis, since it is the only way for foreign banks to survive in China.
Kim met with the press while attending a ceremony to open Hana Bank's wholly-owned Chinese subsidiary in Beijing on Dec. 27.
He said the local banking community has yet to have the inkling for retail financial services and that Hana will be able to differentiate its operation from local banks by providing maximum customer service to its Chinese customers, ensuring success.
Kim said he feels that the expansion of a human connection network and the training of international financial experts are very important to the success of overseas operations. The bank now has only 20 to 30 foreign personnel on its payroll, but it will ultimately be expanded to around 2,000.
He said he has information that the Chinese government will restrict the growth of bank loans to under 15 percent this year and he believes that the local authorities have the power to put their plans into practice and enforce them without any hindrance.
Therefore, Hana will focus on fees in the areas of foreign exchange and trade financing to increase its earnings. The bank will focus its operations on offering its consulting services to the wealthy class of people through private banking. The bank will offer consulting services to rapidly maximize its customer satisfaction levels in order to move ahead of its rival financial institutions in the local market.
Regarding the bank's overseas presence, he said Hana will seek M&As in Southeast Asia and China where risk management is possible to pad its operations to emerge as a major player in the local financial market. Hana plans to focus on its strategy to expand its operations into three northern provinces in China, virgin territory for banks. The bank will also target the wealthy class of people, accounting for about 3 percent of the population in China with its know-how in private banking. In order to do that, the bank will increase its number of branches to over 40 from 7 now by 2012. Kim said Hana must succeed in China to be successful in other foreign countries including Indonesia and Vietnam.
But the bank will just be a minor presence in such countries as India where it has minimal financial operations. In Europe, where the bank doesn't have any financial operations, it will try to share capital with local banks or form strategic alliances.
Under this strategy, the bank plans to expand its operations to some 16 countries in the world including Britain, Russia, the Philippines, and Taiwan. The Hana Bank CEO said by the end of this year, the bank's assets overseas would amount to around $4 billion, about 2.5 percent of its total assets, and it will grow to $9 billion or 5 percent of total assets next year. By 2010, total overseas assets will expand to $20 billion or 10 percent of its total assets.
The bank will focus on setting up a retail banking network in Asia and the United States with the subsidiary in China as the first step in such a strategy.
Kim has stressed that this is the year for strengthening the bank's overseas business network. It plans to set up offices in Dubai and London to expand its overseas presence, which will link its existing network in such financial centers as New York, Tokyo, Hong Kong, and Singapore.
In 2010, Hana will set up offices in Cambodia, Russia, the Philippines and Taiwan, making eight countries in total. Hana took over an Indonesian bank and the Commonwealth Business Bank in Los Angeles last year and plans to take over banks in Russia, Cambodia, the Philippines and Taiwan. nw

President Kim Jong-yol of Hana Bank.