Korea

While large corporate loans remained flat.

Policy banks led the higher profits.

RMB payments surged an impressive 563%.

But it's at a modest pace.

Debt-servicing capacities could be maimed.

Policy banks saw 134.2% profit dive.

How will it affect lending margins?

It reflects only one thing.

Fund announced by Russian President Vladimir Putin. South Korea and Russia agreed this week to establish a US$500 million joint fund with their sovereign wealth funds aimed at increasing cross-border investments in different companies and projects. The deal was announced by Russian President Vladimir Putin who was in South Korea earlier this week on an official visit. Under the agreement, Korea Investment Corporation and the Russian Direct Investment Fund will invest the same amount of money into companies or projects in both nations and invite private sector participation to boost the capital for joint projects. This move is expected to result in a positive return of investment and predictable cash flow. RDIF CEO Kirill Dmitriev said both sovereign funds are currently evaluating a number of joint projects in areas such as infrastructure and energy. He said that with the support of state-backed funds, Korean and Russian companies will feel comfortable when making investments. KIC had some US$64.5 billion in net assets in September while RDIF has US$10 billion in its fund. RDIF was established two years ago to make equity investments, mostly within Russia.

Probe focusing on allegations of business irregularities. The Financial Supervisory Service is undertaking a simultaneous and extraordinary probe of Hana Financial, KB Financial, Shinhan Financial and Woori Financial. Media reports said the main targets of the regulators include former Hana Financial Group chairman Kim Seung-yu and former KB Financial Group chairman Euh Yoon-dae. Kim is suspected of purchasing thousands of art pieces for irregular purposes during his term as group chief and receiving US$3.2 million in incentives from the financial group when he left his post. Hana Financial has denied the allegations. Kim has also been accused of irregularities during his involvement in the group's takeover of Korea Exchange Bank. KB Kookmin Bank, the flagship unit of KB Financial, is being investigated for an alleged slush fund scandal. The bank’s Tokyo branch allegedly has secret funds for the bank's management. Sources said FSS has uncovered traces of evidence the Tokyo branch manager pocketed large sums of fees while approving off the books loans. FSS discovered that a portion of the commissions, allegedly worth over US$1.87 million, might have been transferred to a domestic account. Investigations seek to determine whether the money was sent to the bank’s management. Shinhan Bank has been under investigation over allegations it might have illicitly accessed lawmakers' bank accounts and private information. Woori Bank allegedly conducted sales of financial products without fully explaining the risks to consumers.

This due to strong popularity of smartphones.

What could have caused this?

It's been going on since 2008.

South Korea raising stature in the international community.

Generates annual return rate of up to 10%.

Becomes first bank to offer this liquidity management solution.