Kakao Bank lends more than anyone else in Aug.Kakao Bank, the country’s second exclusively online bank, lent the largest amount of new loans in the first two weeks of this month thanks to lower interest rates and its easy procedures.
According to the Financial Supervisory Service on Wednesday, 540 billion won ($473 million) in new loans were borrowed from Kakao Bank in the first 11 days of the month. The online bank launched July 27.
Those loans exceeded issuances by Korea’s other 19 banks and accounted for one quarter of the 2.17 trillion won that was borrowed during the period.
Shinhan Bank trailed behind with 400 billion won, KB Kookmin Bank with 300 billion won, KEB Hana Bank with 270 billion won and NH Nonghyup Bank with 250 billion won.
The country’s first internet-based bank, K bank, only lent 3 billion won of in the period.
Kakao Bank also was able to attract customers by offering low interest rates.
For people with poor credit histories, interest rates on loans from commercial banks are roughly in the 10-percent range. Consumer finance companies charge percent or more. Kakao Bank’s interest rates are below 10 percent.
It has been disrupting the local banking industry since it was officially launched as it has been enjoying huge popularity even more than its rival K bank, which was the first online-only bank in the country when it.
As of last Friday, Kakao Bank had 2.28 million accounts opened and deposits amounting to nearly 1.22 trillion won. It had lent 880.7 billion won in loans.
With such unexpected popularity, Kakao Bank announced Friday that its board of directors decided to raise 500 billion won by issuing 100 million new shares. K bank, which launched in April, also on Thursday announced it was raising 100 billion won by issuing 20 million new shares.
Meanwhile, KEB Hana Bank lent the most among banks since the beginning of this year.
BY LEE HO-JEONG [firstname.lastname@example.org]