South Korea’s KakaoBank joins Singtel, Grab to back Superbank
SOUTH Korea’s KakaoBank is joining Grab, Singtel and Emtek Group to invest in Superbank. It will acquire a 10 per cent stake in the upcoming digital bank through the issuance of new shares.
The move comes ahead of Superbank’s planned launch of its app to the public this year.
Superbank was previously known as Bank Fama International, which was majority owned by Indonesia-listed media and technology conglomerate Elang Mahkota Teknologi, or Emtek Group.
Grab and Singtel subsequently made their own investments in the Indonesia-based entity, with Singtel acquiring a 16.3 per cent stake in January 2022 for 500 billion rupiah, at the time worth about S$48 million.
In a joint statement between KakaoBank and Superbank on Tuesday (Oct 10), both parties highlighted Superbank’s strength in its ecosystem of prominent entities such as Grab, Singtel and Emtek Group, known for their extensive market penetration across diverse sectors.
With KakaoBank as the latest addition to Superbank’s investors, the South Korean mobile bank plans to actively collaborate in developing the upcoming digital bank’s products and services.
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Its investment and collaboration with Superbank also marks the first step of its global business, said KakaoBank’s chief executive Yun Ho Young.
“KakaoBank’s innovative mindset and expertise as a trailblazer in digital banking will boost Superbank’s proposition for consumers and businesses and we look forward to the customised and unique banking experiences that Superbank will bring to market later this year,” said Ang Hwee Huang, vice-president of Singtel.
Ang is also a director at Singtel Alpha, a shareholder of Superbank.
“Their investment is an affirmation of Superbank’s potential and the enormous growth opportunity for financial services in Indonesia.”
Commenting on KakaoBank’s partnership with Superbank, Lim & Tan said the “cross-selling opportunities are tremendous given the extremely wide reach of Singtel and Grab’s customer base”.
The research house on Tuesday said it remains sanguine about the medium to longer-term growth potential of Singtel’s digital banking venture.
It noted that the telecommunications provider’s Monday closing price of S$2.38 implies a market capitalisation of S$39.3 billion and a forward price-to-earnings ratio of 15.2 times.
This translates to some 5-6 per cent in forward dividend yields with the stock trading at 1.5 times price to book, said Lim & Tan, which has issued an “accumulate” rating on the stock.
The research house also highlighted that Bloomberg’s one-year consensus price target of S$3.09 for Singtel points to a potential upside of 30 per cent.
Shares of Singtel were trading S$0.04 or 1.7 per cent higher at S$2.42 as at the midday break on Tuesday, after news of KakaoBank’s investment.
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