'Coin' K-Bank VS 'IPO' K-Bank... The Prelude to Mid-Interest Rate Battle Begins

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[Asia Economy Reporter Kiho Sung] The market structure of internet-only banks, which had shown an overwhelming gap, is recently reversing its trend. K Bank, which had lagged behind KakaoBank that achieved rapid growth by surpassing 16 million subscribers, is recently expanding its size at a frightening pace. If K Bank gains more momentum in growth, the mid-interest rate market, expected to be a major source of revenue in the second half of the year, is also anticipated to become a fiercely contested battleground.

According to the financial sector on the 2nd, K Bank recorded its largest-ever growth in the second quarter of this year, with 2.28 million new subscribers added compared to the previous quarter. The cumulative number of users as of the end of June reached 6.19 million. During the same period, the loan balance exceeded 5 trillion won, reaching 5.09 trillion won. This represents a quarterly increase of 1.26 trillion won, the highest ever. Deposits increased by 2.57 trillion won, totaling 11.29 trillion won.

During this period, KakaoBank's cumulative number of users increased by 560,000 from the previous quarter to 16.71 million. Although the number of new subscribers per quarter is smaller than K Bank's, the cumulative number is 2.5 times that of K Bank. Deposits and loans stood at 26.6259 trillion won and 23.1265 trillion won, respectively.

K Bank's rapid growth was largely influenced by cryptocurrencies. In June last year, K Bank started issuing deposit and withdrawal accounts through a partnership with Upbit, a cryptocurrency exchange. As cryptocurrency prices surged, the number of users grew exponentially. In December last year, K Bank began to catch up with KakaoBank by adding 210,000 new subscribers monthly (compared to KakaoBank's 220,000). In January this year, 280,000 new users joined, surpassing KakaoBank's 210,000 for the first time. In the second quarter, the number increased by 2.28 million, exceeding the total number of 1.57 million subscribers accumulated over the past three years in just one quarter.

Along with this, the popularity of flagship products such as the 100% non-face-to-face ‘Apartment Mortgage Loan’ and the ‘CodeK Time Deposit’ offering the highest interest rate without conditions also contributed. Despite subscription restrictions for stable operation, the Apartment Mortgage Loan recorded 500 billion won in the first quarter and 700 billion won by the end of June this year. The CodeK Time Deposit, which offers a special interest rate of 1.5% per annum (for one year) to all subscribers without complicated conditions, reached 200 billion won within one week of the event's launch.

As K Bank continues its rapid progress, competition among internet-only banks is expected to intensify further. Especially, depending on government policies, internet banks are putting their lives on the line, and their performance in the mid-interest rate market will determine their results in the second half of the year.

In the market, the prevailing view is that it is unlikely for K Bank to overtake KakaoBank immediately. As of the end of June, KakaoBank's cumulative subscribers numbered 16.71 million, more than twice K Bank's 6.19 million. The loan scale also shows a nearly fivefold gap, with K Bank and KakaoBank at 5.09 trillion won and 23.1265 trillion won, respectively. Particularly in terms of brand awareness, K Bank is considerably inferior to KakaoBank.

An industry insider said, "Although K Bank has recently shown rapid growth, it is clear that the gap is too wide to surpass KakaoBank. However, leveraging its frightening growth speed, it is expected to show a strong presence in the mid-interest rate war that will unfold in the second half of the year without falling behind."

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