Goldman Sachs last week launched an onshore banking operation in Korea that will offer foreign exchange and interest-rate derivatives in the coming months. The firm has been eyeing an onshore desk in recent years (DW, 6/27/04) and finally received a commercial banking license from the Financial Supervisory Commission after placing an application late last year (DW, 10/21).
The license--which is restricted to one branch--will allow the firm to offer won-denominated interest-rate and fx products. For the move, Jake Ko, in fixed-income derivative sales in Hong Kong, has been named branch head and will relocate to Seoul in the coming weeks, according to a senior fixed-income official at the firm. Ko declined all comment.
Firm officials said the U.S. house is now in the process of hiring sales and trading staff for the initiative and should be up and running within the next few months. The firm has been servicing Korean clients via its Hong Kong hub.
"The Korean market is very competitive. It's going to take them a year or so to gain ground against firms that have already built up strong client relationships," said a branch head at a rival bank in Seoul. Edward Naylor, spokesman at Goldman, declined to comment on that point.
In recent years such securities houses as Lehman Brothers, Morgan Stanley and Merrill Lynch have set up onshore derivative desks in Korea to take on traditional global banks.
