[1mm Financial Talk] JB Financial, Sincere About Fintech... Why They Even Make Equity Investments

Not only Securing a Foothold for Overseas Business
But Also Aiming to Overcome the Limitations of the Honam Region with Difficulties in Large-Scale Loans
Reflects Chairman Kim Ki-hong's Intentions as Well

JB Financial Group has made its third strategic investment in a fintech (finance + technology) company this year. It is engaging in ‘aggressive’ collaborations such as equity acquisitions. Analysts interpret this as a move to lay the groundwork for overseas business expansion as well as an attempt to overcome the limitations of regional finance.

On the 1st, JB Financial Group signed strategic partnership agreements with OKXE, a Vietnamese used two-wheeler trading platform, and Webcash Group, a domestic B2B (business-to-business) fintech solution provider. Along with this, it simultaneously made equity investments in both companies. JB Financial Group and JB Investment will jointly acquire shares in OKXE, with JB Financial securing about an 8% stake. In the case of Webcash Group, JB Financial Group, Jeonbuk Bank, and Gwangju Bank will acquire approximately 10% of the shares in ‘Bizplay,’ a fintech company within the group that is pursuing new business.

The cooperation with the two companies is part of JB Financial’s plan for overseas business expansion. JB Financial Vietnam securities affiliate JBSV will conduct joint promotions and online-offline channel marketing partnerships with OKXE. With Webcash Group, Cambodia IT affiliate Cosine and JB Financial Group’s overseas affiliate PPC Bank will collaborate to secure future growth engines in Cambodia.

JB Financial stands out among financial holding companies for its significant fintech investments. A distinctive feature is strengthening collaboration through equity acquisitions rather than simple investments. Representative examples include Finda and Hanpass, which were invested in last year. On the 7th of last month, JB Investment acquired a 3.9% stake in Vietnamese financial platform Infina and plans to expand its stake to about 5% through affiliate JBSV.

Kim Ki-hong, Chairman of JB Financial Group

The collaboration with fintech companies appears to reflect the intentions of Kim Ki-hong, Chairman of JB Financial Group. Since his inauguration, JB Financial has adopted strategies different from those of existing financial holding companies. Notably, it has focused on asset expansion through mid-interest loans targeting low- to mid-credit borrowers and fintech collaboration. Kim has extensive experience across the financial sector, including banks, the Financial Supervisory Service, insurance companies, and asset management firms. A financial industry insider said, “(Chairman Kim) has a broad perspective due to his diverse experience, making it easier to pursue strategies different from others,” adding, “The bold fintech investments align with this approach.”

There is also an analysis that this is an attempt to overcome the limitations of regional financial holding companies. The Honam region, where JB Financial is based, experiences slower industrial growth compared to the Seoul metropolitan area. Compared to BNK Financial Group and DGB Financial Group, which are based in the Yeongnam region with a solid industrial base such as manufacturing, JB Financial’s corporate loan scale is smaller. According to statistics based on affiliated banks, JB Financial Group’s corporate loan balance stood at KRW 23.1782 trillion at the end of last year. This is only about 36% and 70% of BNK’s KRW 64.7591 trillion and DGB’s KRW 33.2556 trillion, respectively. The proportion of large corporations in corporate loans is also similarly low. JB Financial’s large corporate loan balance is KRW 1.3645 trillion, accounting for 5.9% of corporate loans, compared to 7.8% for BNK and 13.5% for DGB. This is because large companies seeking substantial funding are not located in the Honam region.

To overcome this, JB Financial is actively investing in fintech companies. This can overcome structural limitations that make it difficult to expand the business network, and collaboration with overseas fintech companies can facilitate overseas expansion. At the agreement ceremony with OKXE and Webcash Group, Chairman Kim stated that JB Financial Group will create a co-growth model with fintech companies and said, “(This investment) can enhance JB Financial Group’s technology-based market competitiveness in corporate finance and overseas business sectors.”