Expat-earned money doesn't stick around very longA key question expats face once they've accumulated a few paychecks is how to manage their finances. Most opt to wire their savings home, perhaps to an investment manager who will add it to their portfolio. Some find investment bankers in Hong Kong or Tokyo. Very few, it seems, use local financial institutions for anything more than your basic banking functions.
An employee at Kookmin Bank's Itaewon branch, Shelagh Killeen, said, "Most of our foreign clients are here for only two or three years, so we refer them to a separate global financial advisory firm for long-term investments." Schuyler Roche, an expat working at a local law firm, agreed: "Some folks buy CDs but that's about the extent of their investments." Ms. Roche said she sends the bulk of her savings home to the United States, investing only a small portion of it at Kookmin.
Still, local banks are trying to draw foreigners. Kookmin and Hana Bank are among the banks that offer special services to expatriates. David Lim, an employee at Hana, said his bank provides services, including investment products, tailored for expatriates. "We provide everything from general banking information to comprehensive guidance on investment and taxation in order to meet foreigners' needs," Mr. Lim said.
Hana has been trying to employ more fluent English speakers to better serve its foreign clients, both corporate and individual. For corporate clients such as embassies and multinational businesses, Hana offers services such as remittances, advice on legal and tax issues, and loan facilities.
For individuals, Hana offers services in three main areas: account management, including basic retail banking services such as foreign exchange, credit card issuance, transfers and Internet banking; investment advice, which centers on time deposits, beneficiary certificates, mutual funds and certificates of deposit; and advisory services, such as tax and legal advice (such as on real estate purchases) and long-term financial planning.
Tulay Sazli, who works at the Turkish Embassy, has kept two accounts at Hana for more than a year. She said that all the staff members at the embassy go to Hana. "The service there is very good and we don't have to wait in long lines because they have an exclusive teller for us," she says. "The only difficulty I have with banks here in Korea is that I cannot withdraw U.S. dollars from the ATM machines."
Kookmin's Itaewon branch is also known for providing reliable consumer banking services, according to Ms. Roche. "They have a native speaker at the branch who is British, and expats get great service there," she said.
The branch in Itaewon provides advice on short-term investments, such as foreign accounts and term deposits, as well as consumer banking services such as international transfers and credit card services.
For the most part, though, long term investment advisory services are not offered at Kookmin's Itaewon branch. For that you'll have to get online and talk to your investment expert back home.
If you're wondering about Citibank, that well-known foreign bank that is fairly established in Korea, it does not provide special or exclusive services for foreigners.
So if you're determined to keep your money on the peninsula, and want it to go to work for you, what should you do? Ask a friend. Most expatriates rely on word-of-mouth to find the best banking services.
"It's a fairly small community so we know which bankers have good reputations," says Ms. Roche.
by Choi Jie-ho