This blog may contain not-so-strong languages and slightly strong ecchi pictures. Please proceed with caution.

Friday, 11 September 2015

KorEconomics 101 (한국경제학개론), Part XXII: Shinhan Bank - The Oldest Bank in Korea, established since 1897

Shinhan Bank (Hangul/Hanja/Romanization: 신한은행/新韓銀行/Shinhan Eunhaeng; SWIFT SHBKKRSE, numeric 088), is a bank, headquartered at Daekyung Building, 20 Sejong Boulevard 9th Street/Sejong-daero 9-gil, Taepyeongno 2-ga 120-beonji, Seoul Jung-gu, Republic of Korea. The building is overlooking the Sungnyemun Gate or also known as Namdaemun Gate, Korean Republic's First National Treasure.

Historically it was the first bank in Korea, established under the name Hanseong Bank since the foundation of Korean Empire in 1897. The bank was reestablished in 1982. It is part of the Shinhan Financial Group, along with Jeju Bank. Chohung Bank merged with Shinhan Bank on April 1, 2006.

Shinhan Bank started as a small enterprise with a capital stock of KRW 25.0 billion, 279 employees, and three branches on July 7, 1982. Today, it has transformed itself into a large bank, boasting total assets of KRW 176.9 trillion, equity capital of KRW 9.7 trillion, 10,741 employees, and 1,026 branches as of 2006. Total deposits and net income amounted to KRW 105.3 trillion and KRW 1.4 trillion, respectively. Shinhan Bank is the descendant of Hanseong Bank, the first modern bank in Korea. It was established by Kim Jong-Han in 1897, but began operating around 1900. It was originally located in a small house with only two rooms. One room was for the president, and the other room was for the staff. The bank operated by borrowing money from Japanese banks at low interest rates and then loaning it out for twice the rate to the Korean market. The Bank was successful because despite lending out money at twice the rate it borrowed it at, the bank's interest rates were still far lower than what could be obtained elsewhere in Korea at that time.

Shinhan Bank, together with its subsidiaries, provides a range of commercial and other banking services to retail and corporate customers in Korea and internationally. It offers retail banking services to individual customers, wealth management customers, and institutions, such as hospitals, airports, and schools. The company also provides corporate banking and treasury services to corporations, including small or medium sized companies and businesses related to investment banking; internal asset and liability management; trading of securities and derivatives; and investment portfolio management and other related activities. 

In addition, it engages in international bank services, as well as administration of bank operations and merchant banking account. The company’s product portfolio includes various deposit products, such as saving accounts, time deposits, and installment accounts; loans, including mortgage and personal credit loans; investment options; foreign exchange; and retirement pension products, as well as Internet banking, ATMs, and fee based services. As of December 31, 2014, it operated 797 domestic branches, 103 depositary offices, 24 premises, and 8 overseas branches.

In an anecdotal story the bank's first property to use as collateral on a loan happened to be a donkey. The bank staff were challenged to feed and care for their collateral as the loan was out.