Kakao Bank IPO
Kakao Bank (KB), South Korea’s largest digital bank, aims to raise up to US$2.2bn in its South Korean IPO. Kakao held a 31.62% stake prior to listing.Kakao Bank is a digital-bank which counts Kakao as its main shareholder. It is a branchless digital bank that only started operations in 2017. As of Mar 21, it had a loan book of US$18.8bn, deposit base of US$21.1bn. It had 16.5m customers as of May 21.
Even though Kakao started operations only in July 2017, by 2020 it had already garnered more than 1% market share of overall loans and deposits in South Korea. KB’s loans have grown by 138% over 2018 to 1Q21 to reach KRW21.6tn, while its deposits have grown by 197% over the same period to reach KRW24.2tn.
Over 2018-20, its total income grew by 216%, while it went from booking a loss in 2018 to reporting a 26% profit margin by 2020. KB’s total income was up another 60% YoY in 1Q21, while PAT was up 153% YoY.
The company has only recently started working with other Kakao affiliates to garner more non-financial data which will be used to further expand its offering to consumers with lower credit usage.
On the flip side, it might end up competing head on with Kakao Pay in some areas as their respective boundaries remain undefined.
Kakao is engaged in the provision of Internet services to its users and advertisers. Co. provides its owned and operated online properties and services for its users. Co. provides a range of tools and marketing services designed to enable businesses to reach its users for its advertisers.
Aequitas Research is a leading ECM research firm with a focus on IPOs and placements/follow-on offerings across the Asia Pacific with deal size of over USD100m.
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