Getting Ready for
New Financial Law

Industrial Bank of Korea sets up Marketing Headquarters to prepare for changes in financial environment next year

President Yun Yong-ro of the Industrial Bank of Korea said recently that the bank has begun to provide low-interest loans to SMEs from the end of July under a loan facility called "SME Hope Loans."The interest rate charged on these loans is 2.75 percent lower than that of ordinary loans provided to SMEs around the country.
The IBK CEO said the bank decided to provide a special type of loan to help SMEs tide over the difficult times expected in the second half of the year under its package of programs to support SMEs.
The IBK's support facilities to SMEs include 1 trillion won in special low-interest loans for businesses with good future prospects. The special loan fund will come from the bank's special deposit account called the "SME Hope Bankbook"which is expected to draw some 2 trillion won in deposits.
As of June 7, the deposit account had a total of 883.7 billion won deposited, which breaks down to 502.3 billion won deposited by SMEs,
350.6 billion won by individual depositors and 321.1 billion won by public organizations.
Of the fund, 500 billion won will be loaned to SMEs with poor financial conditions under the name of the "SME Network"based on their sales through cards, 300 billion won will go to SMEs with good prospects and 200 billion won will be allocated to technology and management reform SMEs.
The IBK said recently it has integrated or scrapped some of its business divisions and departments.
About 200 employees, or 18 percent of its workforce at the head office, have been dispatched to local branches to expand sales activities and programs. The bank also established new units for global investment banking and human resources to find new growth engines and train financial experts.
The new marketing division will focus on developing financial services products and strategies, IBK officials said.
Each employee at the product development department of retail banking, corporate banking, credit card, bancassurance and funds will all gather under the new marketing division to discover new marketing strategies for integrated financial services, they said.
"By streamlining the business structure, we aim to boost efficiency at outlets as well as to actively respond to upcoming privatization and capital market integration,"an IBK official said.
He said the IBK has set up the marketing headquarters recently to take charge of the new marketing strategies and the development of new financial products. Manpower left after the reorganization, estimated to number about 200, will be reassigned to branches.
The new marketing unit will focus its activities on meeting the customers'needs and the development of new financial products including a fusion of current products and complex new ones as well as drawing up marketing strategies designed to strengthen frontline sales activities. The new marketing unit will absorb manpower assigned to product development units of individual, corporations, card, bancassurance, and funding units and the existing sales units will deal only with sales activities to make them stronger, the bank said.
The reorganization will reduce the number of units to 13 headquarters and 41 departments, which will lead to some 200 personnel or 17.5 percent of the IBK's total manpower to be reassigned to branches as a result of the closure of a headquarter and four similar operational units.
The bank will also set up the human resources headquarters to train more personnel to be experts on international banking operations to make its IB unit stronger. nw

A view of the headquarters building of Industrial Bank of Korea in Seoul.

President Yun Yong-ro of Industrial Bank of Korea.