Seoul, Feb 9 (IANS): South Korea's four major banks will close more offline branches by March, despite their record interest income in 2024, amid a growing demand for mobile banking services, the lenders' data showed on Sunday.
The country's four major lenders -- KB Kookmin, Shinhan, Woori and NH Nonghyup -- are expected to operate a combined 3,160 brick-and-mortar branches at the end of March, down from 3,330 at the end of 2023, according to the data.
Shinhan plans to reduce the number of its branches by 57 during the mentioned period to operate 665 outlets at end-March, reports Yonhap news agency.
Woori plans to shut down 52 offline bank branches over the cited period to run 659 outlets at end-March, with NH Nonghyup and KB Kookmin planning to reduce 36 and 25 outlets, respectively, to 1,064 and 772.
"The decision to integrate outlets within a range of 1 kilometer is aimed at providing more convenient face-to-face services to customers in more comfortable and spacious outlets," a KB Kookmin official said.
But Hana Bank plans to increase the number of its outlets from 597 to 602 during the same period.
Critics say the reduction of brick-and-mortar branches could cause much inconvenience for elderly customers who prefer face-to-face banking services.
KB Kookmin, Shinhan, Woori and Hana reported a combined interest income of 41.8 trillion won (US$28.7 billion) last year, up 3.1 percent from a year earlier.
However, the trend of reducing offline branches is unlikely to be reversed, as a growing number of people now conduct their banking on their computers or smartphones without visiting bank branches.
The emergence of internet-only banks in recent years has upended the way people do business with banks in South Korea, one of the world's most wired countries. These internet-only banks offer their services around the clock without face-to-face contact with customers and without brick-and-mortar branches.
Traditional banks have also expanded their mobile banking services in recent years to try to stay relevant.