| KakaoBank CEO Yun Ho-young |
By Lee Kyung-min
Kakao Bank and Kakao Pay, two financial services affiliates of Kakao Corp., are speeding up the timelines of their initial public offerings (IPO). Kakao owns 31.6 percent of Kakao Bank and 55 percent of Kakao Pay.
Kakao Bank will be listed on the Korea Exchange (KRX) on Aug. 8 with its initial subscription price likely to range between 33,000 won ($29.2) and 39,000 won.
Kakao Pay plans to apply for a brokerage license with the Financial Supervisory Service (FSS) this week, following the passage of its request to the KRX for preliminary approval, Monday.
The number of the internet-only bank's stocks available for public subscription will be 65.45 million, accounting for 13.78 percent of total outstanding shares. Between 2.1 trillion won and 2.5 trillion won will be drawn from retail investors.
Part of the investment will be used to increase its available capital reserve, which is a prerequisite in offering loans to medium- and low-credit borrowers.
About 350 billion won will be invested to hire skilled professionals, come up with new products, set up a consumer protection infrastructure, research and develop financial technologies and acquire other fintech firms.
Kakao Bank also plans to set up a joint venture to enter global markets as part of its medium- to long-term growth strategy.
The corporate value of the bank is between 15.6 trillion won and 18.5 trillion won, the third-highest after KB Financial Group which is valued at 23.8 trillion won and Shinhan Financial Group valued at 21.6 trillion won. Hana Financial Group is valued at 14.3 trillion won.
Market watchers say the bank's value will range between 15 trillion won and 20 trillion won, given the firm's 5 trillion won in equity capital and price-to-book (PBR) ratio of 3.5.
The bank was launched in July 2017 and began reporting a surplus just 18 months later.
Its net profit reached 113.6 billion won last year, marking an eight-fold increase year-on-year. Net profit during the first three months of this year stood at 46.7 billion won.
Its customer deposit totaled 26 trillion won as of May, while outstanding loans totaled 22.7 trillion won. It has over 14.47 million users and total assets of 28.6 trillion won as of March
| Kakao Pay CEO Ryu Young-joon |
It has 36 million users as of June and annual trading volume spiked to 67 trillion won last year, up from 3.8 trillion won in 2017.
Net loss was 25 billion last year. It reported 284.4 billion won in sales last year, up from 141.1 billion won in 2019, 69.5 billion won in 2018 and 10.6 billion won in sales in 2017.
Its corporate value is estimated at between 15 trillion won and 16 trillion won.