In stark contrast to restructuring their workforce and branch operations at home, major South Korean banks plan to expand their business across Asia as they seek to bolster foreign presence to drive growth amid a slowing economy and record low interest rates, industry data showed Sunday.

The country’s top five lenders ― Woori Bank, KEB Hana Bank, Shinhan Bank, KB Kookmin Bank and NH Nonghyup Bank ― are stepping up efforts to increase their global operations by adding 120 locations, including branches, subsidiaries and liaison offices, this year, seeking a new income source outside Seoul.

The move comes as the government’s measures are expected to squeeze the Seoul-based banks’ margin in their lending business as financial authorities look to step up monitoring on the growing household debt and efforts to restructure debt-laden and unprofitable companies.

The government’s preliminary approval for Internet-only banks last year is also expected to stir competition in the stagnant banking sector.

State-run Woori Bank, which already has the largest overseas operations, will be the market leader in aggressively pursuing global expansion this year again.

According to the bank, it plans to add some 95 offices and subsidiaries to take the count to 300 from the current 205 in 18 countries.

“While seeking quantitative growth, we will also enhance profitability through various sales strategies in overseas markets,” Woori Bank president and CEO Lee Kwang-goo said. 

KEB Hana Bank, which is in second place in terms of foreign operations, is planning to increase the number from 126 to 144, including a new subsidiary in Mexico.

It will launch a branch in Gurgaon near New Delhi, India, this year and is also eyeing the acquisition of a savings bank in the Philippines with an aim to pump up its overseas asset ratio to 40 percent of the total amount by 2025.

“Emerging overseas markets such as China and Indonesia will be our targets to expand customer base. We will strengthen business connections between domestic and overseas units,” KEB Hana Bank president Ham Young-joo said in a recent interview.

Despite the lenders’ efforts to make a foray into new markets in recent years, their overseas business growth slowed in the first half of 2015, according to Financial Supervisory Services.

Experts blamed the economic slowdown in China, where accounts for 25 percent of the Korean banks’ total overseas assets, for the lower growth rate last year.

Total overseas assets of local lenders, including the top five players, amounted to $89.41 billion during the first six month last year, up 3 percent from $86.84 billion tallied in the end of 2014. They posted over 10 percent year-on-year growth in previous years.

The overseas income accounted for 10.6 percent of the banks’ total profit over the cited period.

KB Kookmin Bank, which has the highest number of active domestic customers, is opting for quality over quantity for overseas business.

The lender will remain dependent on its home operations, while focusing on the existing overseas units instead of increasing investments abroad, the bank said. It currently operates 19 locations in 11 countries.

“We plan to pursue steady expansion by strengthening our foreign currency business instead of resorting to unfeasible expansions,” the bank’s official said.

NH Nonghyup Bank is preparing to bolster its presence in Vietnam and India this year to diversify risks. Currently, it runs three operations in New York, Beijing and Hanoi.

Some sources said that the bank is also eyeing acquisition targets in Southeast Asian countries including Myanmar, Cambodia and Indonesia.

By Park Han-na (hnpark@heraldcorp.com)