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South
Korea: Better than Terrible
Snapshot: 18 banks in the 500 (1999: 19) Assets: $481.5b.
($452.2b.) Profits: -$6.5b. (-$11.3b.)
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Last
year, it was Daewoo's collapse that burdened banks. This year it is
Hyundai's woes. Who will next be in the news? (Hint: The initials
might be LG.) Not surprisingly, banks that haven't lent to Hyundai
especially its construction arm could benefit most from
a robust recovery.
RESTRUCTURING With Round One now complete, the government is
pushing for further consolidation. It hopes two or three beefed-up
banks could compete globally, so don't be surprised by a big merger
before the end of the year.
LENDING Deposit growth has soared at a rate of about 35% this
year thanks to nervous savers yanking their money out of troubled
investment trust companies to put in banks (which, in comparison to
the ITCs, are actually pretty solid).
LIBERALIZATION The law now allows foreigners to control local
financial institutions. Some have taken advantage of it. More would
if the prices of Korean banks weren't so dear.
Performance Topnotchers:
10 Best Performing Banks
|
Institution |
HQ |
Assets
$
Mill |
Profits
$
Mill |
Profit
as
% of |
500
Rank
|
Assets |
Equity |
1 |
KOOKMIN
BANK |
Seoul |
64,130
|
-24.4 |
|
|
32 |
2 |
HANVIT
BANK |
Seoul |
63,994
|
-2,002.9 |
|
|
33 |
3 |
H
& CB |
Seoul |
42,772
|
399.6 |
0.9% |
21.1% |
52 |
4 |
KOREA
EXCHANGE BANK |
Seoul |
41,712
|
-723.6 |
|
|
53 |
5 |
CHOHUNG
BANK |
Seoul |
41,247
|
-655.8 |
|
|
54 |
6 |
INDUSTRIAL
BANK OF KOREA |
Seoul |
37,634
|
110.7 |
0.3% |
6.7% |
57 |
7 |
SHINHAN
BANK |
Seoul |
37,465
|
100.1 |
0.3% |
4.0% |
58 |
8 |
HANA
BANK |
Seoul |
32,343
|
127.0 |
0.4% |
8.2% |
71 |
9 |
KOREA
FIRST BANK |
Seoul |
24,955
|
-882.8 |
|
|
88 |
10 |
SEOULBANK |
Seoul |
21,340
|
-1,962.3 |
|
|
100 |
Write to Asiaweek at mail@web.asiaweek.com
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Rating
show the number of banks in each category; "E" is the lowest
grade for financial soundness.
Souce: Moody's Investors Service
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