Banks In South Korea

Updated on March 20, 2024
Article bySayantan Mukhopadhyay
Edited bySayantan Mukhopadhyay
Reviewed byDheeraj Vaidya, CFA, FRM

What Are Banks In South Korea?

The banks in South Korea are quite an important topic of discussion in the global financial market. The country’s financial system is well-developed and stable, offering a variety of facilities to customers for individual and national development.

Banks in South Korea

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As per Moody’s Investment Services, the Korean banking system does not look promising. They have given a negative rank to the Korean banking system. They have also mentioned that things will deteriorate in the next 12-18 months. The main reason is that Moody thinks it will soon reduce the banks’ creditworthiness, which has been detailed below. But overall, some growth has been definitely seen in the sector, which may change the scenario in the future.

Banks In South Korea Explained

The banks in South Korea are a part of the country’s financial system, which is well-developed and has a lot of positive influence on its economic condition. In spite of undergoing lots of changes, both from a qualitative and quantitative point of view, the system is still running steady.

Significant events have been like the consolidation of banks and the rise of holding companies. There have also been changes in the form of an increase in hiring in this sector and growth of banking assets.

Due to the development of the country, many Foreign Institutional Investors (FII) and other financial institutions have entered the economy with plans and strategies for business. This has also contributed to economic development and upliftment of largest banks in South Korea.

A list of top-performing banks in South Korea has been detailed in the article later, which we will study. However, it is good to know that along with banks, there are also a significant number of investment and insurance companies, financial institutions that specialize in mutual funds, and special credit facilities along with co-operative and holding companies.

However, it is worth noting that due to the sudden surge in online banking and mobile banking systems, there has been quite a lot of decline in customers visiting the banks physically to complete their transactions. Thus, even though the largest banks in South Korea opened many branches and sub-branches in various parts of the country, many of them are being closed down due to a lack of customer visits and also a rise in cost in the form of rent, maintenance, employee salaries, etc.

Even then, there has been an overall increase in the return on assets (ROA) of the banks along with the significant rise in net interest margin (NIM), which are indicators typically used to measure the growth of the banking industry.

There had been stagnation and a need for positive growth opportunities in this sector of South Korea a few years back. Economists and analysts had cited some critical reasons for the same, as given below:

There are a few important reasons for this negative outlook of international banks in South Korea: –

But currently, most of it has changed, and the entry of foreign investors has played a huge role in the country’s economic development.


There are around 148 banks that are licensed in South Korea.

These banks can be divided into three broad categories: –

  • Commercial banks: 52 commercial banks serve local customers in South Korea.
  • Specialized banks: Only five specialized banks provide services to a niche segment of customers.
  • Mutual savings banks: There are 91 mutual savings banks in South Korea, the maximum among all.

Financial Supervisory Services (FSS) regulate and control the banks. The Bank of Korea acts as the country’s Central Bank, which issues Korean Won and maintains price stability.

The government of the country helps in implementation and monitoring of price stability and also regarding taking decisions related to credit policy and monetary control. The structure of national and international banks in South Korea is expected to remain stable and grow further.

Research shows that the customer satisfaction index related to the national and foreign banks in South Korea is entirely satisfactory. The digital banking system has drawn a medium to good satisfaction levels from customers. The number of mobile bankers has remarkably increased along with a surge in the total value of their transactions. But even though the physical bank visits were significant a few years back, they were reduced due to COVID-19 and the adoption of mobile banking. Thus, we see that the customers very quickly adapted to the change and have continued to do so ever since.

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List Of Top 10 Banks

  1. KB Kookmin Bank
  2. Shinhan Bank
  3. Nonghyup Bank
  4. Hana Financial Group
  5. Korea Development Bank
  6. Woori Bank
  7. Industrial Bank of Korea
  8. DGB Financial Group
  9. Kwangju Bank
  10. Busan Bank

Here is a brief description of each of these national and international banks in South Korea in detail (source: Relbanks) –

#1. KB Kookmin Bank:

KB Kookmin Bank is a subsidiary of KB Financial Group. It is one of the top banks in South Korea. It was founded in 1963, around 59 years ago. Its headquarters is located in Seoul. It has over 1,100 branches across the country, serving about 30 million customers. It also has 3,000 ATMs all over the country. At the end of June 2017, the total assetsTotal AssetsTotal Assets is the sum of a company's current and noncurrent assets. Total assets also equals to the sum of total liabilities and total shareholder funds. Total Assets = Liabilities + Shareholder Equityread more acquired by the KB Kookmin Bank were 422.249 trillion KRW.

#2. Shinhan Bank:

Shinhan Bank is one of the top banks in South Korea. It was established in the year 1982, around 35 years ago. About 13,400 employees work here. They have a presence in over 19 countries. Only in South Korea, Shinhan Bank has over 900 offices. Shinhan Bank is the main subsidiary of Shinhan Financial Group. At the end of June 2017, the total assets acquired by Shinhan Bank were 413.911 trillion KRW. Its headquarter is also located in Seoul.

#3. NongHyup Bank:

NongHyup Bank (NH) is the subsidiary of NongHyup Financial Group. It was established in 2012, 10 years ago. NongHyup Financial Group is owned by the National Agricultural Cooperative Federation (NACF). NH Bank has around 1200 branches in South Korea, focusing on commercial banking services. At the end of June 2017, the total assets acquired by NongHyup Bank were 381.600 trillion KRW. The headquarters is also located in Seoul.

#4. Hana Financial Group:

Hana Financial Group was established in 1967, around 55 years ago. It is the fourth-largest commercial bank in South Korea. At the end of June 2017, the total assets acquired by this bank were 349.045 trillion KRW. Its head-quarter is also located in Seoul. Around 21,700 employees are employed in the Hana Financial Group. It operates through a whopping 1,100 branches in South Korea and 150 in 24 countries.

#5. Korea Development Bank:

Korean Development Bank (KDB) was established in 1954, around 68 years ago. There are approximately 3,200 employees as of Dec 2018 that work in KDB. The headquarters of KDB is located in Seoul. KDB has a network of 80 domestic branches. It is one of the top banks in total assets acquired. We found out from the last data that KDB has obtained around $233.9 billion of total assets as of Dec 2018.

#6. Woori Bank:

Among the national and foreign banks in South Korea, it is one of the largest banks in terms of total assets acquired. As of 2019, the total assets acquired by this bank were 361,981 billion. The headquarters is also located in Seoul. It is quite an old bank. It was established in the year 1899, around 123 years ago. It serves about 21 million customers and has a network of 1,000 domestic branches. Woori Bank has the largest global network among all Korean banks.

#7. Industrial Bank of Korea:

The Industrial Bank of Korea (IBK) is to help develop small and medium-sized enterprises. The Government of South Korea owns a major stake in this bank, around 57.7%. This bank is one of the top banks in South Korea. At the end of June 2017, the total assets acquired by this bank were 257.482 trillion KRW. If we consider small business loansLoansA loan is a vehicle for credit in which a lender will give a sum of money to a borrower or borrowing entity in exchange for future repayment.read more, 81% of these loans are offered by the Industrial Bank of Korea.

#8. DGB Financial Group:

DGB Financial Group is one of the largest regional financial institutions in South Korea, established in 2011, just 11 years ago. Daegu Bank is the flagship company of DGB Financial Group, one of the largest regional banks. Its headquarters is located in Daegu. And it serves most of the customers in the Daegu-Gyeongbuk region. In addition, it is one of the significant South Korean holding companies. At the end of June 2017, the total assets acquired by this bank were 56.870 trillion KRW.

#9. Kwangju Bank:

Kwangju Bank was established in 1968, around 54 years ago. The main focus of Kwangju Bank is to provide financial aid to local small and medium-sized business owners. About 1,500 employees work in Kwangju Bank. The headquarter of this bank is located in Gwangju. At the end of September 2014, the total assets acquired by this bank were 17.432 trillion KRW. It was previously known as the KJB Financial Group.

#10. Busan Bank:

This bank is one of the most popular local and top banks in South Korea. It is more of a regional bank than a global bank. However, it provides a wide gamut of financial services to local customers. Financial products and services are limited to personal banking. Busan Bank has a great list of shareholders helping it grow gradually – Lotte group, Capital Research & Global Investors, Templeton, National Pension Service, Aberdeen Asset Management Asia, etc.

It is interesting to learn that the main income source for these list of banks in South Korea continue to be interest from different types of loans that they extend to a huge range of customers who may be corporates or individuals. The part of income from non-interest sources is comparatively small. But the tough competition has forced banks to increase their share of non-interest income too, by increasing branches on global level and giving good services from them.

Tradition banks have made considerable improvements in their services due to entry and competition from fintech and digital companies. This has also led to the betterment of online banking services, resulting in faster growth of the above list of banks in South Korea.  

This article is a guide to what are Banks In South Korea. We explain it with a details about the list of top 10 banks along with their general structure. If you are looking forward to making a career in banking, then you can check out some of the awesome resources: –