K-Bank Soars, K-Bank Chases... Internet Banking Market Heats Up

원본보기 아이콘

[Asia Economy Reporter Kim Hyo-jin] As KakaoBank continues its rapid growth, K Bank is gearing up for a resurgence, heating up the non-face-to-face internet-only bank market. With the addition of Toss Bank, which is set to launch next year, the market is expected to expand even more rapidly.

According to the banking sector on the 5th, KakaoBank recorded a net profit of approximately 26.8 billion KRW in the second quarter of this year. The cumulative net profit for the first half reached 45.3 billion KRW, a remarkable 372% increase compared to 9.6 billion KRW in the first half of last year.

As of the end of June, the asset size grew by 1 trillion KRW from the previous quarter to 24.4 trillion KRW. Loan balances for key products such as credit loans and jeonse deposit loans rose from 14.88 trillion KRW to 17.68 trillion KRW during the first half of the year. The transfer amount, which was 55 trillion KRW in the first half of last year, nearly doubled to 100 trillion KRW in the first half of this year.

The driving factor behind the strong performance is the sharp increase in users. As of the end of June, KakaoBank's mobile application (app) monthly active users (MAU / combined Android and iOS, according to KoreanClick) stood at approximately 11 million, ranking first among all domestic bank apps. The number of users accessing KakaoBank at least once a month increased from 10.62 million in December last year to 11.73 million in June. Account-opening customers rose from 11.34 million at the end of last year to 12.75 million at the end of last month.

With a particularly high usage rate of 47% among those in their 20s and 30s, KakaoBank explained that the influx of relatively older users is also expanding due to the spread of non-face-to-face trends caused by COVID-19 and other factors, with the proportion of new account-opening customers aged 50 and above reaching 17% in May.

Deposits and loans increased by 86 billion KRW and 333 billion KRW respectively from the previous month, reaching 22.4 trillion KRW and 17.7 trillion KRW. KakaoBank analyzed that the expansion of interest income due to the increase in users and loans drove the strong performance.

In the non-interest sector, the deficit narrowed due to the impact of stock account opening applications and the launch of credit card recruitment agency services. KakaoBank's stock account opening applications nearly doubled from 1.14 million at the end of last year to 2.18 million at the end of June. KakaoBank currently operates stock account opening businesses with Korea Investment & Securities, NH Investment & Securities, and KB Securities, and plans to add more partners in the future.

Under Basel III standards, the capital adequacy ratio (BIS) was 14.03% at the end of June. The delinquency rate remained low at 0.22%. The nominal net interest margin (NIM) for the first half was 1.60%.

A KakaoBank official said, "We plan to start practical preparations for an initial public offering (IPO) in the second half to ensure continuous growth and capital expansion," adding, "We will further enhance consumer convenience through financial services completed on mobile."

K Bank, the 'eldest brother' of internet-only banks that had been unable to conduct normal loan operations due to funding difficulties, is accelerating its resurgence by increasing its capital to 900 billion KRW through a large-scale capital increase. After more than two years of development, K Bank plans to establish a growth foundation with the launch of a non-face-to-face apartment mortgage loan this month.

K Bank's apartment mortgage loan features the use of income information scraping technology, allowing users to easily check estimated limits and interest rates without issuing separate documents. The required documents for loan execution have been simplified to two: income verification documents (two years of withholding tax receipts or confirmation of withholding tax on earned income) and the registration certificate (title deed). K Bank expects the time from loan application to approval to be shortened to as little as two days.

Following the launch of the parking account 'Plus Box' on the 1st of last month, K Bank introduced three types of credit loan products on the 13th, signaling the start of business normalization. K Bank's deposit balance increased by about 480 billion KRW compared to the previous month, and the loan balance grew by 170 billion KRW within about half a month after the product launch. K Bank plans to intensify operations in the second half and double key indicators from current levels.

K Bank intends to diversify its operations through strengthened promotions linked with KT, collaboration on card business with BC Card, its largest shareholder, the launch of the '010 Virtual Account' service in partnership with fintech company Settle Bank, and expansion of non-face-to-face financial services to business-to-business (B2B) transactions.

A financial industry official said, "With KakaoBank leading the market and K Bank rapidly catching up, the launch of Toss Bank will accelerate the shift toward non-face-to-face finance," adding, "The expansion of the internet-only bank market is expected to speed up further."

© The Asia Business Daily(www.asiae.co.kr). All rights reserved.