"KaBang Initiates 'Comprehensive Financial Innovation' to Dispel Bubble Controversy"

Press Conference Ahead of IPO
Expected Market Cap Up to 18,528.9 Billion Won
Presenting Various Growth Blueprints

[Asia Economy Reporter Kiho Sung] "Rapid loan growth over three years since service launch in July 2017, turning profitable in just over two years. User base equivalent to half of the economically active population."

The reason KakaoBank is considered a major player in the second half IPO market is due to its ‘ultra-fast’ growth that is rarely seen not only among domestic banks but also globally. In the financial market, there is a prevailing view that KakaoBank will grow beyond being a ‘disruptor’ to a ‘major player,’ threatening existing banks.

The advancing KakaoBank officially begins its listing process on the 20th with institutional investor demand forecasting. KakaoBank’s estimated market capitalization is up to KRW 18.5289 trillion. However, controversy over overvaluation has arisen as the comparison group for pricing the IPO excluded domestic banks and included only foreign fintech companies, drawing market attention to whether the listing will proceed as planned.

On the same day, KakaoBank CEO Yoon Ho-young held a press conference to reveal detailed listing plans. This move is interpreted as an effort to dispel the ‘overvaluation controversy’ ahead of the institutional investor demand forecast starting that day.

KakaoBank will issue 65.45 million new shares through the IPO. The desired offering price per share ranges from KRW 33,000 to KRW 39,000, aiming to raise up to approximately KRW 2.5526 trillion. The offering price will be finalized on the 22nd, with subscription dates on the 26th and 27th. Domestic retail investors can subscribe through KB Securities, Korea Investment & Securities, Hana Financial Investment, and Hyundai Motor Securities. The scheduled listing date is July 6.

Based on the offering price, the market capitalization ranges from KRW 15.6783 trillion to KRW 18.5289 trillion. This is slightly smaller than KB Financial Group (KRW 21.2478 trillion) and Shinhan Financial Group (KRW 19.7083 trillion) among KOSPI financial stocks, but larger than Hana Financial Group (KRW 12.8804 trillion). If the offering price is set at the upper limit, KakaoBank will rank third in market capitalization among domestic financial groups.

KakaoBank is actively blocking ‘bubble’ controversies. In the revised securities registration statement submitted the day before, the peer companies were selected as four foreign firms: U.S. retail lending platform Rocket Companies, Russia’s digital bank Tinkoff Bank’s largest shareholder TCS Holdings, Sweden’s digital financial platform Nordnet, and Brazilian fintech PagSeguro, excluding domestic commercial banks. CEO Yoon declared, "We will achieve innovation beyond banking across the entire financial sector," signaling differentiation.

He emphasized that through continuous digital innovation of banking products and services and expanding product competitiveness, KakaoBank will "grow into a financial platform that customers must use." He also presented a blueprint to expand from current credit cards, stock accounts, and linked loans into funds, insurance, asset management, and connections with various industries such as e-commerce and travel. Additionally, starting next month, new credit loan products for medium- and low-credit customers will be introduced, along with various loan products such as personal business (SOHO) loans.

The use of funds raised through the IPO aligns with KakaoBank’s future direction. It will be used to secure capital adequacy for expanding loans to medium- and low-credit customers, acquire talented personnel, innovate customer experience, and operate to enhance financial consumer benefits. The funds will also be invested in research and development (R&D) of financial technology, mergers and acquisitions (M&A) of fintech companies, and global expansion.

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