After Kakaobank, K Bank and Toss Bank Gain Momentum... Internet Banks Accelerate IPO Pace

Stimulated by KakaoBank's Full-Scale IPO
Competition Accelerates Ahead of September Internet Banking Three Kingdoms

[Asia Economy Reporter Kiho Sung] As KakaoBank, an internet-only bank, officially begins the process of listing on the Korea Composite Stock Price Index (KOSPI), the initial public offerings (IPOs) of K Bank and Toss Bank are also gaining momentum. With Toss Bank set to launch in September, the internet banking "Three Kingdoms" era is expected to fully unfold, and fierce business competition will likely accompany fundraising through IPOs.

According to financial sources on the 29th, KakaoBank submitted its securities registration statement to the Financial Services Commission yesterday to list on the KOSPI. If the public offering process proceeds smoothly, the listing is expected to take place in early August. KakaoBank's listing is significant as it marks the first bank sector listing in 27 years and the first internet bank to enter the KOSPI. The last bank to be listed was Industrial Bank of Korea in 1994. The market estimates KakaoBank's corporate value to be between 20 trillion and 30 trillion KRW.

As KakaoBank's listing process gains momentum, K Bank and Toss Bank are also expected to accelerate their stock market challenges. The next candidate is likely K Bank, Korea's first internet-only bank. Although K Bank has not publicly disclosed its IPO plans, it aims to turn profitable next year and go public in 2023. If it fails to IPO by 2023, BC Card, its largest shareholder, will have to purchase the shares held by financial investors (FIs).

However, if K Bank achieves profitability sooner than expected, the listing could be expedited accordingly, according to market observers. Thanks to last year's cryptocurrency boom, K Bank recorded a net loss of 12.3 billion KRW in the first quarter of this year, reducing its deficit to about half of the 24 billion KRW loss in the same period last year. Recently, it expanded its capital base through a large-scale paid-in capital increase amounting to 1.25 trillion KRW.

Toss Bank, scheduled to launch in September, also has a high possibility of an IPO. When granting approval to Toss Bank, financial authorities imposed a condition requiring the bank to faithfully implement its capital increase plan until it reaches its breakeven point, expected in 2025. There is a prevailing view that once profitability is achieved, Toss Bank will promptly proceed with an IPO. Accordingly, 2025 is anticipated as the breakeven year. If profitability is reached earlier than 2025, the IPO timing could also be accelerated. Previously, Toss Bank CEO Min-taek Hong stated, "We are not considering an IPO yet," but added, "Raising large-scale funds through an IPO during the capital increase process remains an open option," leaving the possibility open.

If the IPO roadmaps of K Bank and Toss Bank proceed smoothly following KakaoBank, all three internet-only banks are expected to be listed by 2025.

This content was produced with the assistance of AI translation services.