By Jhoo Dong-chan
The nation's financial firms are paying close attention to the latest developments in the trade feud between Korea and Japan. They said that there have yet to be any signs of serious aftereffects from the trade row but they have held a series of emergency meetings to discuss the possible risks that could be caused by prolonging the conflict.
According to industry sources, not only commercial banks, but also credit cards as well as savings banks discussed the possible risks to their financing and loan business as the tension between the two countries is now heading toward a trade war.
Of Korea's four main commercial banks, Shinhan has boasted its presence in the Japanese market. It is also the only Korean bank that has set up a corporate body in the country.
Shinhan Bank solely financed the establishment of Shinhan Bank Japan in 2009. Shinhan Bank Japan currently operates 10 branches and four foreign exchanges in major cities including Tokyo, Osaka and Fukuoka.
Shinhan Bank Japan posted a 64.9 billion won net profit, accounting for about 20 percent of the bank's total earnings in the global market. Its assets also occupy about 25 percent of Shinhan Bank's foreign operations.
Shinhan Bank CEO Jin Ok-dong also stressed the importance of the bank's operation in Japan during his inauguration ceremony, saying Shinhan Bank Japan has played "an important role in stably securing Japanese yen" as a countermeasure for possible domestic and global risks.
A bank official said it hasn't seen any signs of crisis just yet.
"It has yet to show any issues at this point," the official said. "However, the current situation could be prolonged further. We will thoroughly monitor the latest developments to counter possible risks."
Credit card firms and savings banks, which depend more heavily on Japanese investment compared to commercial banks, are keeping a closer eye on the Korea-Japan trade feud.
They were financed through Japanese banks since they offer 20 to 30 basis points lower interest rates than their Korean counterparts.
"It is true we got sizable loans from Japanese banks, but we haven't seen any side effects from the Korea-Japan trade row," said a domestic credit card official who asked not to be identified.
Local savings banks such as SBI, JT and OSB Savings, whose major shareholders are Japanese, also downplayed the current trade tension between the countries.
"There is no sign of investment exit," said an SBI official.