Corporate Banking

SME Loans

  • IBK plays a vital role in supporting SMEs that struggle from lack of capital. In 2017, we granted KRW 8.2 trillion in loans to SMEs, representing about 20% of the KRW 41.6 trillion net total SME loans extended by the overall banking industry.
  • SME Loans (In trillions of KRW)
  • IBK’s total loans outstanding stood at KRW 182.1 trillion, of which KRW 142.4 trillion (78.2%) were SME loans. IBK is the only bank with a SME market share exceeding 20%; as of end of 2017, its share was 22.4% to give IBK a commanding lead over the competition.
  • The number of corporate clients passed 1.4 million on the strength of efforts to improve core capabilities and expand the client base. We will continue efforts to attract corporate clients to secure future growth engines and solidify IBK’s standing as a powerhouse in corporate financing.
Product Development
  • As a state-invested financial institution specializing in SMEs, IBK developed a wide variety of products catering to the needs of startup companies, small business owners, and others in the SME sector to invigorate the economy, create jobs, and encourage entrepreneurship.
  • Special Small Business Owners Loan expands support for small business owners experiencing difficulties during a recession by offering preferential loan terms such as advantageous interest rates.
  • IBK Start-up 3 Plus Program helps start-ups resolve their initial financing difficulties by offering credit loans, low interest rates, or deferred interest to SMEs that have been in operation for less than seven years. Job Creation Plus Loan is a low interest rate loan that enhances SMEs’ ability to drive job creation. The IBK Co-Prosperity Loan supports job creation and SMEs in cooperation with large corporations and public agencies.
  • We have also developed multiple products to help companies with highly competitive technologies obtain the funds they need in a timely manner for successful commercialization.
  • IBK New Growth Vision Loan is a preemptive response to the fourth industrial revolution. It provides companies that meet the criteria for new growth engines with systematic financial support and various non-financial services
  • IBK Smart Factory Loan works in tandem with government support for ICT smart factories to contribute to the development of globally competitive companies. With the loan, ‘hidden champion’ companies can receive timely funding to build and operate smart factories.
  • In response to internal and external changes in SMEs’ business environment, IBK is adopting big data, scraping and other fintech developments. With proactive measures that anticipate SMEs’ capital difficulties, we are making every effort to expand SME support, create jobs, and promote start-up companies.
  • Companies with promising technologies can take advantage of the CB (Convertible Bond) Issuance Loan, an investment product available at branches designed to encourage investment in promising technology companies. Based on their technology levels, borrowers can receive benefits like preferential interest rates.
  • ME Venture Development Fund Loan gives preferential support for technology commercialization by venture companies certified by the government or relevant organization. The borrower has to show it has officially recognized capabilities such as a recommendation from a pertinent institution or new equity investment.
  • Other products include Loan for Companies in Strategic Regions which offers preferential funding to companies located or planning to move into industrial complexes as well as Co-op B2B Purchasing Card Loan which finances group purchases of subsidiary materials that go through co-ops. With the introduction of such specialized products, IBK is strengthening its market power and solidifying its position as SMEs’ trusted supporter.
  • SME Loans (In trillions of KRW)
SME Support Services
  • The IBK Hidden Champion Exporters and Technologies Program provides comprehensive support to SMEs, from customized loans to non-financial services. The companies selected as IBK’s ‘hidden champions’ possess globally competitive exports or technologies.
  • In 2017, we designated 68 IBK hidden champions and 53 IBK next-generation hidden champions with plans to respectively add some 60 and 50 companies to the two categories in 2018. The program will help relatively unknown companies with high growth potential succeed on the global stage.
  • IBK Friend Service offers SMEs complimentary access to contents about leadership, business trends and more via the IBK website for bank customers. CEOs and board members can gain economic/management knowledge and sharpen their decision-making skills. In a December 2017 survey, 99% of the respondents said they were ‘very satisfied’ with the service. The service has gained wide popularity among SME executives looking for reference materials or developing leadership capabilities.
  • IBK Corporate Real Estate Advisory Service gives users the opportunity to take advantage of our alliance with a real estate consulting firm to request guidance on real estate transactions, investment analysis, and real estate management strategies. The service is used extensively to meet the real estate consulting needs of our SME customers, manage VIP customers, and to attract customers from other banks.

Services for SMEs

  • We are committed to fulfilling our role as a leader in SME financing and offer many customized services for SMEs at all stages of growth. Our services focus on expanding financial support and professional consultations for promising SMEs.
  • SME Loans (In trillions of KRW)
Advisory Services
  • With the newly set goal of ‘partnership consulting’ in mind, we provide solutions to correct weaknesses based on analysis of difficulties our SME customers will likely face.

  • Performance in 2017
  • IBK has the largest consulting organization in the financial industry. It is composed of some 70 professionals with prior experience in prominent consulting, accounting and law firms. These experts are fully equipped to advise SMEs on matters like business strategy, human resources, productivity, succession in family businesses, taxation, accounting, law, and patents.
  • In particular, we offer solutions for problems encountered by companies in different stages of growth. Since 2011, IBK has provided free consulting to a total of 5,328 SMEs.

  • Plans for 2018
  • Our goal for 2018 is to offer ‘partnership consulting’ to SMEs. To that end, we will anticipate the kind of difficulties they will have to face and provide solutions through integrated diagnostic consulting. The initiative will allow us to practice inclusive finance by supporting innovative companies with new growth potential, companies with low credit, small business owners, and entrepreneurs trying to revive or overcome failed ventures.
  • IBK’s ‘3-Up’ initiative will provide phase-by-phase consulting to SMEs. We will offer consulting services to help SMEs achieve innovation and growth, establish smart factories, and expand into overseas markets. Our service scope will be expanded to include customized advice on exit strategies as well as ‘job plus’ counseling.
  • Furthermore, we will host a Management Academy and publish a management guide book specifically geared toward SMEs. We will share IBK consulting research materials so they reflect on-site feedback from SMEs, and branch out into other efforts to help SMEs prosper. At IBK, we believe SMEs are the bedrock of the national economy, and we aim to support their continued growth. Ultimately, our consulting services will allow IBK to form long-term partnerships with customers, and in the process, strengthen IBK’s own foundation for growth.
Support for Start-up Companies
  • We established the Startups Support Unit, which works under the direct supervision of the Chairman & CEO, to strengthen support for startups and venture companies. The Team has integrated the scattered support functions and is focusing on growth financing. As a policy bank, we also put the government’s start-up support policies into practice with speed and efficiency so that we can foster a healthy environment for innovative startups. Moreover, we draw up measures to improve the survival rate of new ventures so that both the bank and the companies can prosper, and actively uncover the needs of startups from their perspective.
  • Our plan is to deliver KRW 100 trillion in funding to start-up companies over a five year period from 2017 to 2021. The annual target was raised from KRW 18 trillion to KRW 20 trillion in the 2017 ‘Seven Year Plan for Start-ups,’ and the increased funding will address the biggest concern of start-ups - lack of capital. Further assistance will come from the Master Program through which we are strengthening our line-up of investment and loan products for every stage of a startup’s growth.
  • Financial Sector: In November 2017, IBK, IBK Capital, and IBK Securities formed the IBK Financial Group Job Creation Fund with KRW 20 billion and began phase-by-phase investing in start-up companies both directly and indirectly. We also established the IBKKIP Growth Stepping Stone PEF with KRW 100 billion and began supporting innovative start-ups that show potential for growth in new industries or are already leading the fourth industrial revolution (bio, AI, big data, O2O).
  • In December, we launched IBK Venture Start-Up Loan to promote innovation with low interest funds supporting start-ups with recognized technology and less than seven years of experience. We also channel assistance through the Special Support Program for Start-ups and Small Business Owners, a KRW 1 trillion effort to ease the burden of financial expenses by applying ultra low interest rates (1% level) regardless of the company’s credit rating.
  • Non-Financial Sector: We established IBK Changgong (meaning blue skies) in December 2017 as an integrated platform for start-up support. Its objective is to find proactive and creative ways to help companies through the difficulties that each stage of growth entails.
  • IBK Changgong is in charge of helping start-ups formulate viable business models by drawing on IBK’s SME financing knowhow, consulting capabilities and global network. Having benchmarked Silicon Valley Bank’s system, IBK Changgong provides financial and non-financial services to improve the survival rate of startups and support their growth.
  • IBK acts not only as lender but also consultant, mentor and investor. Our comprehensive services include free office space, investments and loans, help with exploring new markets, mentoring, and 1:1 consulting based on stage of growth. What’s more, partnerships with highly regarded accelerators and venture capital firms allow us to build a cohesive support system.
  • Currently, we are pushing ahead with a plan to build an inter-company network for information exchange. IBK operates three clubs as part of this program: IBK Cheong-chul-eo-lam (meaning the ‘blue comes from the indigo plant’), a venue for exchange information between start-ups and established companies; IBK Venture Summit which brings together start-ups and companies in IBK Changgong; and IBK Showcase, an open platform for information on startups. The clubs enable established companies to act as mentor and investor by matching them up with start-ups and by holding regular networking events.
Job Creation
  • IBK is leading the way in diverse job creation efforts to resolve youth unemployment and SMEs’ labor shortage.

  • Performance in 2017
  • Job World’s Employment and Start-up Fair brings together high-performing SMEs and well qualified personnel. In 2017, there were 51 fairs nationwide that attracted 210,000 job seekers and resulted in the employment of 3,335 individuals.
  • IBK is seeking to encourage more hiring by SMEs by offering financial benefits through means such as the Preferential Interest Rate Fund for companies interested in job creation. Benefits include KRW 500,000 for every full-time worker hired through Job World and employed for more than six months. Thus far, 3,129 companies have received KRW 34.3 billion.
  • IBK Scout Service is a 1:1 customized hiring service wherein a professional headhunter selects and recommends highly talented individuals to SMEs without charging the usual fee (20% of the annual salary). The service matches SMEs with experienced workers, researchers and senior executives, and helped 148 SMEs and 507 job seekers in 2017. Scout Service also promotes visits to promising SMEs and the bank’s employment support programs to young job seekers and employment counselors at colleges and vocational schools. Such efforts are effective in calling attention to SMEs with superior working environments and help raise SMEs’ profiles.

  • Plans for 2018
  • Going forward, we will pursue comprehensive programs that link start-ups with job creation to promote employment as well as entrepreneurship. IBK will continue to lead the way in improving SMEs’ profile by discovering and publicizing high value SMEs. We will also fulfill our social responsibilities by acting as a reliable bridge between SMEs and talented workers.

Retirement Pensions

  • The retirement pension system involves a company investing money with a financial institution on behalf of employees so that they can enjoy a stable lifestyle after retirement. The workers can receive the money in the form of a lump sum payment or annuities when their employment with the company is terminated.
  • Release of ‘Only-One’ low interest mid-term loan (interest rate below 2%), February 1, 2018

  • Performance in 2017
  • Retirement pensions fall into three categories: the defined- benefit (DB) plan, defined-contribution (DC) plan, and individual retirement pension (IRP). Under the DB plan, the payout upon retirement is predetermined and the company is responsible for asset management. By contrast, the DC plan requires the company to set aside a predetermined sum each year while the employee is responsible for asset management.
  • IRP is an account for retirement benefits and subscribers can choose to make additional contributions.
  • Since retirement pensions were first introduced to Korea in December 2005, the market has grown to KRW 167 trillion with 370,000 corporate subscribers.
  • IBK recorded a net gain of KRW 1,742.7 billion from the previous year to accumulate reserves of KRW 12,156.9 billion (market share of 7.29%). Most significantly, IBK joined the ranks of the ‘Big 3’ in the banking industry.
  • Corporate subscribers rose by 5,945 for a total of 94,641 (market share of 25.61%), helping to secure IBK’s undisputed place at the top of the market again and confirming our credibility and stability as a pension fund operator.

  • Plans for 2018
  • Government policies geared toward economic recovery and job growth were expected to expand the pension market, but most of the potential corporate subscribers have already signed up for pension plans, meaning the growth trend is likely to slow down. Meanwhile, the continuation of low interest rates and proliferation of DC plans have heightened customers’ interest in asset management.
  • IBK will respond preemptively to market changes by pursuing qualitative growth of pension funds. We will work to increase customers’ returns with products that offer high returns and stability and present customized portfolios. In addition, we will help start-ups subscribe to pension plans and pursue other ways to build a strong and stable sales foundation so that we can be our customers’ financial partner in growth. We will promote a user-friendly pension system and develop non-face-to-face channels to enhance customer convenience.
  • Release of ‘Only-One’ low interest mid-term loan (interest rate below 2%), February 1, 2018
  • Release of ‘Only-One’ low interest mid-term loan (interest rate below 2%), February 1, 2018

International Trade

  • IBK is pursuing healthy growth through profit-centered foreign exchange operations. Our focus is on delivering innovative best-in-class service to attract new customers and better serve existing ones.
  • Release of ‘Only-One’ low interest mid-term loan (interest rate below 2%), February 1, 2018

  • Performance in 2017
  • In 2017, IBK’s FX operations recorded USD 136 billion in revenue, up USD 22.6 billion from the previous year and operating income increased KRW 25.2 billion to KRW 144.4 billion. We were able to attain our operating income goal by attracting high-profit-per-dollar SMEs and strengthening management of invisible trade by individuals.
  • We are actively seeking ways to support SMEs in their quest for global competitiveness. For instance, we collaborated with Banco Santander and other partner banks to offer IBK TradeClub Service to support export and import companies develop overseas sales channels. We also expanded P@yGOS, IBK’s export receivables collection service for international e-commerce transactions. Joining forces with KOTRA’s BuyKOREA and GoBizkorea, P@yGOS now offers greater support for e-commerce exporters who wish to enter overseas markets. Cooperation with KOTRA, Korea International Trade Association and other related agencies provide IBK with increased opportunities to find new and promising client firms.
  • As a way to promote foreign direct investment, we form partnerships with major organizations and offer advice and marketing assistance to companies seeking to attract foreign capital. One of our support programs includes identifying potential foreign investors and matching them with IBK customers. In addition, we hosted a series of marketing events to broaden our retail customer base for FX and remittance services. We also held a number of customer-oriented seminars on FX remittance using the system of “foreign marketers” of various countries.

  • Plans for 2018
  • IBK will focus on strategic marketing, FX operations for future profit generation and stronger risk controls through process improvement to build a foundation for sustainable growth in the midst of rapid change in the financial environment.
  • First, we plan to strengthen strategic FX marketing by creating a competitive system to address problems plaguing small- to mid-size export companies. To do so, we will pursue more effective partnerships with the Ministry of SMEs and Startups, KOTRA and Korea International Trade Association. Furthermore, customer- centered services like IBK TradeClub and P@yGOS will be expanded to facilitate export and import companies’ entry into overseas markets.
  • Second, we will expand profit-based FX operations by attracting more foreign direct investment. Our efforts will include identifying profit-making SMEs seeking to attract FDI and helping them to connect with foreign investors. This will be done through related agencies and by organizing marketing events. Moreover, we will revamp our non-face-to-face channels (online, smart banking) and develop a wide range of customer-oriented services.
  • Third, to hedge against FX risks, we will continue efforts to upgrade FAIS (Foreign exchange Abnormal transaction Investigation System) launched in 2016 for better risk management and internal control. We also plan to strengthen training in FX compliance and share up-to-date information through on-site training programs to react swiftly to major issues such as unexpected financial regulations.
  • Release of ‘Only-One’ low interest mid-term loan (interest rate below 2%), February 1, 2018
  • Release of ‘Only-One’ low interest mid-term loan (interest rate below 2%), February 1, 2018