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Citibank Korea Pursuing Growth via Global Banking

Posted March. 19, 2010 08:20,   


Citibank Korea President Ha Young-gu is called a “marathon CEO.”

This year marks the 10th anniversary of his term as a bank CEO. Ha was the only person recommended as the next CEO at the bank’s board meeting last week. After confirmation at a shareholders’ meeting March 30, he will lead the bank for three more years. He is the first person to be named to four consecutive terms, including a stint at the now-defunct KorAm Bank.

The Dong-A Ilbo talked to Ha Wednesday at his office in downtown Seoul and asked what the secret of his success is. He hesitated, then said, “This was the largest shareholder’s will.”

Citigroup owns 99.96 percent of Citibank Korea. When Dong-A asked the same question differently three times, he finally spoke.

“KorAm Bank and Citibank merged in November 2004. Two banks with totally different cultures were integrated. It was completely different from the integration of domestic banks,” he said.

“Employees had significant cultural shock. At the time, we tried to grow stronger internally. Employees trusted and followed management. Now, we are strong enough to say growth strategy.”

Though Citigroup had seen its ups and downs -- its largest stakeholder became the U.S. government after the global financial crisis erupted -- Citibank Korea has done well. Though controlling less than four percent of the Korean banking sector at the end of last year, the company has seen its share of profits generated in the sector grow much higher.

Accordingly, Citibank Korea’s sales strategy has changed into “profitable growth.”

“Despite growth, if we follow what other banks do, this will only encourage herding. Herding was the cause of the financial crisis. We will create a new sales model others cannot mimic,” he said.

Citibank Korea will strengthen its global banking services by taking advantage of Citigroup’s overseas network spanning 100 countries from this year. The overseas network is a critical tool that can differentiate the bank from domestic competitors.

The biggest task for Citibank Korea this year is shifting to a financial holding company. It plans to create three subsidiaries – Citibank Korea, Citigroup Capital, and Citi Financial Sales Korea – under the tentatively named Korea Citi Financial Holdings and place Citi Credit Service under the subsidiaries.

The Financial Supervisory Service has authorized this in advance, another major change since Citibank Korea began operations six years ago.

“When we get official authorization next month, we can launch a holdings company in May. When we change into a holdings company, subsidiaries can share the customer database and conduct various marketing, allowing the bank to cut costs,” Ha said.