Domestic Banks Earn 2.4 Trillion Won from Overseas Branches Last Year

Last year, domestic banks earned approximately 2.4 trillion won (about $16.5 billion) from their overseas branches. The number of overseas branches increased to 211, and total assets surpassed 330 trillion won.

According to a report released by the Financial Supervisory Service on May 21, the net profit of domestic banks' overseas branches reached $1.651 billion (approximately 2.4 trillion won), a 2.3% increase from the previous year. This figure represents 9.8% of the total net profit of domestic banks, which was 24.1 trillion won.

Interest income rose to $380.1 million, up 4.5% from 2024, driving overall net profit growth. However, non-interest income fell to $610 million, a decrease of 8.3% compared to the previous year. The return on assets (ROA) for total assets was 0.71%, down 0.03 percentage points.

While net profits increased in countries like Indonesia ($10.5 million) and the United Kingdom ($6.5 million), they declined in China ($8.6 million).

As of the end of last year, domestic banks had a total of 211 overseas branches in 41 countries, an increase of four from the previous year (207 branches in 41 countries). Five new branches opened, while one branch was closed.

IBK Industrial Bank established a new local subsidiary in Warsaw, Poland, while Hana Bank opened branches in Devanahalli and Mumbai, India. Korea Development Bank also opened a new branch in Frankfurt, Germany. NH Nonghyup Bank converted an office in London, UK, into a branch.

By country, India had the highest number of overseas branches at 22, followed by Vietnam (20), the United States (17), China (16), and Myanmar (14). In total, Asian branches accounted for 67.3% of all overseas branches, with 142 branches.

The total assets of overseas branches reached $233.13 billion (334.5 trillion won), an increase of $16.05 billion (7.4%) from the previous year.

The overall evaluation grade for localization indicators remained at '2+', the same as the previous year. The Financial Supervisory Service assesses the level of localization of overseas branches and the level of internationalization of the headquarters, reflecting both at a 50% rate in a 15-grade system.

A Financial Supervisory Service official stated, "The management status of domestic banks' overseas branches remains generally sound. However, due to the prolonged conflict in the Middle East and external uncertainties, we plan to encourage enhanced risk management for overseas branches and strengthen internal controls at the headquarters level."