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South Korean Banks Expand in Poland to Support Booming Offshore Manufacturing

Kookmin Bank and Others Establish Strong Presence in Poland, Catering to Korean Firms in Batteries and Defense
South Korea
k 105560.KO w 316140.KO Blue Chip 150 Mid and Small Cap 2000
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South Korean banks are rapidly expanding their operations in Poland, aligning with the country’s emergence as a new offshore manufacturing hub in Eastern Europe. This move is particularly aimed at supporting Korean companies, which are increasingly establishing factories in Poland, focusing on sectors ranging from battery production to defense systems.

Kookmin Bank, the commercial banking unit of KB Financial Group Inc., South Korea’s largest financial holding company by assets, has initiated the process of establishing a ‘Korea Desk’ in Poland. This office will serve as a liaison, facilitating the business activities of Korean companies in Poland, which is strategically located near key Eastern and Central European markets like the Czech Republic, Slovakia, Hungary, Germany, and Ukraine.

Poland’s growing status as a global rechargeable battery production base, second only to China, has attracted leading Korean companies such as LG Energy Solution Ltd., SK IE Technology Co., POSCO Holdings Inc., and SKC Ltd. These firms are establishing battery-related manufacturing facilities in the region. Additionally, major automakers Hyundai Motor Co. and Kia Corp., along with electronics giant LG Electronics Inc., have set up operations in Poland.

The influx of Korean investment in Poland’s manufacturing sector is not limited to the battery industry. Korean defense companies have also made significant inroads, with exports of defense systems, including FA-50 lightweight combat aircraft and K9 self-propelled howitzers, totaling 1.5 trillion won ($1.1 billion) last year.

Kookmin Bank is looking to further its reach in Eastern Europe through local partnerships, focusing on corporate lending to Korean firms in Poland and the surrounding region. Woori Bank, under Woori Financial Group Inc., is also enhancing its presence by upgrading its liaison office in Katowice to a local branch office, aiming to provide prompt financing services in sync with the growth of Korean weapon exports.

The state-run Industrial Bank of Korea is likewise incorporating its existing office in Poland, with plans to apply for permission to establish a new entity. Its office in Wrocław is strategically located near major manufacturing facilities of LG Energy Solution, POSCO, and LS Cable & System Ltd.

As Poland becomes a key manufacturing hub for Europe’s largest producer of lithium-ion batteries for the automotive industry, competition among Korean banks to offer corporate loans and financing services is expected to intensify. This banking expansion reflects the deepening economic ties between South Korea and Poland and the increasing importance of Poland in the global manufacturing landscape.

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