It has been almost twenty years since Korea Exchange Bank, which is the first Korean-capital bank in China, set up the Beijing representative office. Some initial success has been achieved during the two decades. Ten Korean-capital banks had established 64 branches in 13 major cities in China by the end of 2011. Among the ten banks, five of them had funded the PRC legal identity, which has taken a great proportion among foreign-capital financial institutions. Now Korean-capital banks are playing a decisive role in the foreign-capital banks.
On the occasion of the 5th anniversary of gaining membership of the WTO, Chinese financial market had fully opened to foreign-capital banks in Dec 11th, 2006. From then on, foreign-capital banks stared to enjoy the national treatment. This also brought the prosperous era to Korean-capital banks in China. The amount of Korean-capital banks increased rapidly, in the mean time various types of business and customer groups are expanding. While the huge opportunity has been brought to Korean-capital banks because of the openness of the market, great challenges also await among the other foreign-capital banks and Chinese banks.
This article introduces the current features of the Chinese bank industry, and analyzes the motivations of the Korean-capital banks that went into China by using both domestic and foreign studies of multinational banks’ investment theories. It also summaries the current situation of this kind of bank and points out the problems they are facing with. Though the episode analysis I also studied the strategies about how the Korean-capital banks went into Chinese market. By the end of this article I also came up with my solution to the problems.
First of all, the article introduces the situation about Chinese financial market (like the basic structure, the features, the opening-up situation, the direction of the future development).
Secondly, by studying the motivations and analyzing the present management situation, I found the problems of the Korean-capital banks and came up with some solutions.
At the end, by using the model of SWOT analyzing on Korean-capital banks, the article emphasizes the solutions into 4 aspects: brand reinforcement, financing channels, PB products, localization in order to enter successfully into Chinese market.