Some South Korean banks appear to be enjoying the benefits of increased crypto involvement with K bank reportedly eyeing an initial public offering in 2022.
According to a report by The Korea Times on Wednesday, K bank CEO Lee Mun-whan revealed that the bank would be profitable by 2022, paving the way for the public listing.
K bank — South Korea’s first internet-only bank — is the major Korean won on-ramp for Upbit; one of the “big four” crypto exchanges in the country.
The expected positive revenue turnaround for K bank is coming after a tumultuous 2019 which saw Korea Telecoms barred from becoming the bank’s largest shareholder.
This regulatory imbroglio contributed to K bank posting a 100 billion won ($89 million) loss in 2019.
However, BC Card — a Korea Telecoms subsidiary — has been allowed to become the bank’s largest shareholder without causing any wrinkles with the country’s fair trade laws.
K bank has also seen a 400 billion won ($356 million) capital influx since the resolution of the shareholder issue with Mun-whan stating that the bank is focused on growing its capital base to beyond 1.5 trillion won ($1.3 billion).
For Baek Kyoum Kim of Hashed — a South Korean blockchain investment group — K bank is accelerating its IPO plans on the back of significant growth brought on by onboarding new crypto users.
Upbit's main KRW fiat on-ramp provider KBANK is accelerating its IPO schedule thanks to explosive growth through new crypto user onboarding...— Baek Kim | HASHED (@baekkyoumkim) March 3, 2021
added $2B+ to AUM just in Feb 2021
No wonder why all banks feeling big FOMO on cryptohttps://t.co/tmz6G3XIuv
Indeed, according to a report by The Korea Herald in January, K bank saw a surge in term deposits from new customers looking to invest in cryptocurrencies at the start of the year.
Following laws passed in March 2020, crypto trading in South Korea is only possible via real-name accounts. Thus, crypto exchanges have to work in tandem with commercial banks, likely putting an end to the use of “honeycomb accounts” for cryptocurrency trading.