Tracking the history of Korea Exchange Bank is much like scavenging through Korea’s modern economic history following the 1950-1953 Korean War.
Established in 1967, KEB has contributed to the nation’s banking industry as one of the oldest banks. The bank, well known for its specialized foreign exchange marketing and corporate banking, started its second takeoff in 2012 after it was acquired by Hana Financial Group to become a sister bank of Hana Bank.
Entering the 1960s, the Korean government was calling for exports and dispatching the Korean workforce to overseas sites to boost the economy. As the government started to implement its economic development plan in the 1960s, it needed a foreign currency-specialized bank.
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This photo shows the opening of the Korea Exchange Bank in Seoul in 1967. (KEB) |
In 1967, the government launched KEB as the country’s first state-controlled bank in central Seoul, with 750 officials, one home branch and a total of four branches overseas in Japan, Hong Kong and Vietnam. Now the bank runs the country’s largest overseas network with 54 branches in 23 countries.
The bank has the most “nation’s first” titles under its belt among Korean modern banks. It offered the country’s first online deposit system in 1972 and first credit card services in 1978. It set up then-unprecedented 365-day automatic services in 1990, wire-check services to the U.S in 1995 and a whistle-blowing system “KEB Shinmungo,” derived from the Swedish “Ombudsman” system.
In 2008, the KEB installed the first audio system for ATMs that provides services in 11 international languages.
This all-Korean bank was the official partner bank of the historic 1988 Seoul Olympic Games, heralding Korea’s economic restoration and globalization.
It also sponsored the 1986 Asian Games and the 1997 Muju-Jeonju Winter Universiad. In 2001, it launched the Asian Pacific Bankers Club, a major annual event for bank heads in Asia-Pacific countries.
The rockiest part in KEB’s history ― and Korean financial history ― was the 1997-98 Asian financial crisis. With the state and firms head over heels seeking foreign investment, the KEB in 1997 attracted 350 billion won ($310 million) from Commerzbank AG, a German-based banking and financial firm, without state support.
Another bitter memory came with the U.S. Lone Star Fund, formerly KEB’s largest shareholder since 2003. The U.S. equity fund had been much criticized for what Korean media called its “eat-and-run” practice. The Lone Star Fund is still a wedge between the nation’s political parties.
The vision of KEB’s future lies much in its traditional forte ― global operations. The bank targets foreign regions that other Korean banks have yet to enter.
The bank’s next stops will be emerging economies with a relatively small aging population, age 65 and over. KEB launched a new branch in Abu Dhabi, United Arab Emirates, in December 2012, followed by another in Istanbul, Turkey, last May.
By Chung Joo-won (
joowonc@heraldcorp.com)
