Banks pick wealth management as key business for 2022

NongHyup Bank CEO Kwon Joon-hak pledged Monday to adopt a new model that connects customers with wealth managers through its own digital channel. He said he plans to provide professional and quality services to customers using its digital wealth management channel, in this year’s five-day intracompany wealth management seminar launched Monday.

Following a massive reshuffle in the beginning of the year, Hana Bank established a special team on wealth management. The new wealth management team absorbed the bank’s trust and pension fund division along with other parts that could boost its capacity.

KB Kookmin Bank in December launched an online wealth management platform that allows customers to take tests to find the type of investment that is most beneficial for them. The test provides 16 different types of portfolios for the user to build in collaboration with KB Kookmin’s wealth management services.

Commercial banks have also taken a step toward developing wealth management services for cryptocurrency, though they remain cautious in dealing with the virtual asset under financial authorities’ watchful eye. KB Kookmin, NongHyup and Shinhan are major traditional institutions that have recently revealed their plans to support crypto custody. As crypto custody solutions, they would be third-party providers of storage and security services for cryptocurrencies.

More wealth managers that could take their services to the next level have been hired as well. Local reports said last week that major Korean banks hired more than 50 private bankers who had worked for Citibank Korea and recently left after the bank decided to withdraw its retail banking business in phases. Woori reportedly hired the largest number of them at 22, and placed most of them in its wealth management team for the bank’s wealthiest clients.

The traditional banks’ efforts to digitize and expand their wealth management services come as the government has placed stricter caps on the amount lenders can extend to borrowers. On top of that, Big Tech and fintech firms including Naver and Kakao have been attracting retail customers with their tech-savvy and round-the-clock services, adding to competition in the market.

By Jung Min-kyung (mkjung@heraldcorp.com)