Asia Banking Research
Why is Viva Republica leaning towards an IPO in the U.S.?
It was not long ago that Viva Republica CEO Lee Seung-gun praised South Korea’s fintech market and financial regulators. “Korea is a market where fintech companies can build their foundational strength for overseas expansion,” he said in September at Korea Investment Week in Seoul. “There is no country where the government leads financial innovation as much as Korea,” he added. And yet Viva Republica seems to have decided against an IPO on the Korea Stock Exchange (KRX). Instead, it is likely to go public in the United States, according to several Korean media reports.
Siam Commercial Bank accelerates digital finance push
Thailand’s Siam Commercial Bank (SCB) is among the most proactive lenders in Southeast Asia when it comes to digital finance. It recently has started on work on a Thai baht stablecoin project and is setting up a digital bank in Thailand together with South Korea’s Kakao Bank.
Assessing the K Bank-Upbit relationship
South Korea’s K Bank had a strong third quarter during which its net income surged almost 181% annually to 37 billion won (US$26.3 million). Through September, the online lender had accrued profits of 122.4 billion won, up 220% from the first nine months of 2023. K Bank’s customer numbers are rising steadily as well, reaching 12 million by the end of September, thanks to strong demand for high-interest rate deposits, cashback programs and mortgage loans. There was really no bad news in K Bank’s earnings report, but the lender still faces significant challenges due to its close ties with the cryptocurrency exchange Upbit and its general high reliance on digital assets to fuel growth.
Why Custodian Banks Should Embrace Digital Asset Custody: Key Challenges and Opportunities
This is the first blog in our series on Digital Asset Custody, in partnership with Ripple.
Digital assets have rapidly evolved into a significant component of the financial landscape, particularly in the Asia Pacific region. Defined as assets that exist in digital form and hold identifiable value, ownership rights, or permissions for use, digital assets encompass a variety of forms including cryptocurrencies, non-fungible tokens (NFTs), digital bonds, and stablecoins.
Will the Philippines be removed from the FATF gray list soon?
For nearly 3 ½ years, the Philippines has been on the gray list of The Financial Action Task Force (FATF), which assessed the Southeast Asian country to have inadequate money-laundering and counterterrorism financing controls. Since then, the Philippines has been working to improve those controls so that it can be removed from the list, which is detrimental to the country’s business environment. Its next opportunity to be removed from the list will be in February 2025.
Why did K Bank postpone its IPO again?
South Korea’s No. 2 digital bank K Bank has postponed its IPO plans yet again, after seemingly having committed to a listing in the near future. This development comes as something of a surprise. K Bank posted a net profit of 85.4 billion won (US$64 million) in the first half of this year, the highest since its establishment and more than thrice as much as during the same period a year ago. It seemed that the company had adequate momentum to finally go public. However, looking at a few aspects of K Bank’s business model, we can see why it is delaying the IPO again.
Hong Kong digital banks need more than a name change
More than five years after Hong Kong regulators first announced they would allow digital banks, the online lenders are performing modestly at best – and in some cases, not well at all. The argument that introducing digital banks would somehow alter the competitive landscape of banking in the city and put heavy pressure on incumbent lenders seems increasingly unrealistic. After all, incumbent heavyweights like HSBC and Standard Chartered have long been investing heavily in digitization. Yet both the banks and regulators have been reluctant to acknowledge underlying problems.
Is Toss Bank ready for an IPO?
Viva Republica’s Toss Bank has been visibly contemplating an initial public offering (IPO) since earlier this year. It is aiming to achieve a valuation of 15 to 20 trillion won (US$11 billion-US$15 billion). Toss is feeling increasingly good about going public because of what it sees as strong fundamentals. It has amassed more than 19.1 million monthly active users, while its loan brokerage, payments, advertising and tax services are performing well, as is its subsidiary Toss Securities.
Indonesia’s P2P lending industry has fallen on hard times. After several years of relatively unchecked P2P lending expansion, regulators have decided to crack down on problematic industry players with an eye on heading off catastrophic failures. No doubt China’s experience in the 2010s is instructive for Indonesia, which does not want to see its own retail investors be robbed of their life savings in pyramid or Ponzi schemes.
Singapore rolls out new anti-money laundering recommendations
On October 4, Singapore’s Inter-Ministerial Committee announced new anti-money laundering (AML) recommendations. They include data sharing between agencies, flagging and striking off inactive companies, and programs to educate businesses about suspicious activity and increase the likelihood that they report such activity.
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Taiwan grapples with growing investment scams
Taiwan is grappling with an increasingly serious scam problem, according to a new report that surveyed 25,000 people across the region has found. Conducted jointly by the Global Anti-Scam Alliance, Gogolook and ScamAdviser, a Web site legitimacy checker, the report found that Taiwanese may have lost up to US$7.5 billion over the past 12 months. On average, Taiwanese each lost US$1,940 to scammers, equivalent to 1% of GDP in 2023.
TymeBank an outlier among online lenders
TymeBank is a rising star in Africa as well a key player in the Philippines’ fintech sector. It is one of the few online banks of note to emerge from Africa thus far. TymeBank claims to be one of South Africa’s fastest growing banks and recently reported reaching 10 million customers. While many digital banks highlight rapid customer acquisition, TymeBank appears to be an outlier with its presence in several emerging markets and a strong balance sheet.
First big Taiwan bank merger in years looks likely
Taiwan has long been one of the most overbanked markets in Asia. Strolling the streets of Taipei, one sees a plethora of physical bank branches. Overall, Taiwan has 37 banks, 21 life insurers and 50 securities brokers for a market of just 23 million people. Despite regulatory pressure for consolidation, there have been very few bank mergers in Taiwan over the past two decades.
Why Thailand is only awarding three digital bank licenses
Of the major economies in East Asia, Thailand has been among the slowest to introduce digital banks. The Bank of Thailand (BoT) has never said much about its decision-making rationale in public, but we reckon the Kingdom’s relatively high banked rate (more than 80%) has something to do with it. The wait is finally over, however. The deadline for submitting an application for a digital bank was September 19, and there only be three licenses awarded.