K Bank cuts IPO price range, seeks to reduce reliance on Upbit deposits

  South Korea’s first internet-only bank, K Bank, is making a third attempt at an initial public offering after delaying twice. The bank said it lowered its proposed offering price and adjusted the amount of shares available on the first day of trading to better match market expectations. It also said it is working to reduce its reliance on deposits tied to crypto exchange Upbit.

At a news conference in Seoul on Feb. 5, K Bank CEO Choi Woo-hyung said the bank prepared a “shareholder-friendly” offering structure by cutting the price versus its prior plan and adjusting the tradable float on listing day.

K Bank previously pursued listings in 2023 and 2024 but withdrew, citing factors including weak demand during book-building. Under a 2021 capital increase, the bank included a drag-along clause with financial investors that requires an IPO by July this year, making this its last chance to list.

K Bank set a proposed price range of 8,300 won to 9,500 won, up to 26% below its previous IPO range of 9,500 won to 12,000 won. It also cut the offering size to 60 million shares from 80 million. Based on that range, its price-to-book ratio would be 1.38 to 1.56, far below KakaoBank’s roughly 7 at the time of its listing.

CFO Lee Jun-hyung said KakaoBank shares rose more than 30% over the past three days, lifting K Bank’s implied discount to 30%. He said K Bank’s price range is “heavily discounted” compared with competitors.

Choi also addressed concerns about K Bank’s dependence on Upbit-related deposits. He said that of 6 million new customers over the past two years, only 10% joined to use crypto assets. He added that none of Upbit deposits are used to fund loans and are instead invested in highly liquid money market funds or government bonds, meaning an outflow would have “no impact.”

After listing, K Bank said it will begin preparing to enter the small- and midsize business lending market and aims to launch a product next year, which it described as the first of its kind in South Korea. It plans to cut household loans, now more than 90% of its portfolio, to 50% and balance the rest with corporate lending. With SME loans viewed as higher risk, Choi said the bank will manage delinquencies by splitting credit, guaranteed and secured loans evenly.

K Bank also pledged a post-listing value-up policy. Choi said it will consider shareholder returns such as dividends and share cancellations as it seeks to raise return on equity from about 5% to 15%.