The K Bank IPO is set to go ahead later this month, with its CEO dismissing lawmakers’ concerns about its partnership with the crypto exchange Upbit and “bank run” fears. K Bank CEO Choi Woo-hyung faced journalists’ questions at a press conference on October 15 in Yeouido, Seoul, South Korea, where he stated that a bank run from Upbit customers mass-withdrawing their money from the K Bank platform was “highly unlikely.” The CEO reassured the public that Upbit deposits are managed by matching them with stable investment vehicles such as government bonds and money market funds, minimizing the risk of a bank run.
South Korean law mandates that all KRW-trading crypto exchanges partner with domestic banks to provide real name-verified fiat on/off ramps. Upbit’s partnership with K Bank has been successful, allowing customers to open bank accounts and wallets remotely during the pandemic, giving Upbit a significant market share. Although competitors have made gains in recent months, concerns have been raised about Upbit’s growing monopoly in the market. K Bank has managed to attract younger customers with the help of Upbit’s popularity, leading to a successful public offering bid scheduled for October 18, with a listing date of October 30.
The neobank plans to float 82 million shares at a share price of between KRW 9,500 and KRW 12,000, potentially reaching a public offering total of around $723.7 million at the upper limit. Choi stated that the proportion of total Upbit deposits on their platform has decreased, and the bank is compensating for the reduced interest rates on fiat deposits through other business interests. He also revealed plans to strengthen business partnerships with Upbit and develop new products and services in collaboration with Upbit and BC Card, the card provider.
Despite concerns about Upbit’s influence over K Bank, Choi reassured reporters that their relationship with Upbit remains strong, emphasizing the ongoing partnership development with BC Card and Upbit to create innovative products that connect payment, banking, and crypto services. The contract with Upbit is set to expire in October next year, but K Bank is optimistic about the future of their partnership and the potential for continued collaboration to provide enhanced services to their customers. The success of the K Bank IPO and their strategic partnerships demonstrate the neobank’s commitment to innovation and growth in the competitive crypto market.
