Online bank raises additional capital of 500 billion won

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Online bank raises additional capital of 500 billion won

Kakao Bank, one of two internet banks in the country, implemented a 500 billion won ($441.9 million) capital increase plan on Tuesday as a part of a refinancing plan to bolster its lending business.

Kakao Bank, launched in late July with paid-in capital of 300 billion won, has attracted about three million accounts and extended loans worth 1.4 trillion won as of Aug. 27.

The capital hike was made by issuing 100 million new shares worth 5,000 won each.

Major shareholders of Kakao Bank, including Korea Investment Holdings and Kookmin Bank, were said to have subscribed to the capital increase, according a market source.

Kakao Bank’s consortium also includes eBay and China’s Tencent Holdings.

The bank’s rival, K bank, which was launched in April with paid-in capital of 250 billion won, said last month that it will raise 100 billion won by issuing new shares.

However, some shareholders of K bank, led by KT, the country’s second-largest telecommunications provider, have shown a lukewarm response to the capital hike plan.

Korea bans non-financial firms from owning a stake larger than 10 percent in a financial firm.

If some shareholders fail to subscribe to the capital increase, KT will buy the forfeited shares. However, KT already owns an 8 percent stake in K bank, limiting the amount of new shares it can purchase. YONHAP

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