Korean banks develop AI-powered asset management services

[Courtesy of Shinhan Bank]

South Korean commercial banks are expanding non-face-to-face asset management services using artificial intelligence (AI) technologies, aiming to enable basic asset management without offline visits.

According to sources from the financial sector on Sunday, Shinhan Bank will launch a new digital asset management service in September.

The service uses AI to create tailored asset management portfolios taking into account customers‘ life cycles, investment styles, and goals.

The new service includes tax-saving products like individual savings accounts (ISAs), individual retirement pension (IRP) products, and bancassurance products. It is the first time a commercial bank is offering non-face-to-face portfolios with tax-saving products.

Previously, Shinhan Bank’s non-face-to-face asset management services provided identical portfolio solutions regardless of investment amount, lacking differentiation based on asset level.

The latest service allows users to maintain their existing preferences while setting future goals, such as savings for children‘s college tuition and retirement, creating more detailed portfolios.

“Our goal is to provide personalized asset management services comparable to those of actual private bankers by offering optimized lifecycle asset management solutions based on AI data analysis technology,” the bank said.

Other commercial banks are also expanding their non-face-to-face asset management services using robo-advisors.

KB Kookmin Bank, the first to launch a fund portfolio product using its own AI algorithm, plans to release a product offering comprehensive diagnostics and portfolio suggestions, including assets held by other financial sectors, in the first half of the year.

KB Kookmin Bank has consistently participated in the robo-advisor testbed, monitoring profitability.

”As of February 2024, the annualized return for aggressive investors was 4.48 percent, significantly outperforming the 1.52 percent of competitors,“ the bank said.

Launched in April last year, Hana Bank’s AI-based customer asset management service platform provides a convenient overview of asset status, analyzes assets, and recommends portfolios, including stocks, bonds, deposits, structured investments, and alternative investments.

Woori Bank has offered a generative AI-based financial counseling service for the first time in the domestic market.

This service features an interactive tool that can calculate preferential interest rates and recommend high-interest products tailored to individual circumstances, although currently only for deposit products.

Woori Bank‘s robo-advisor service, launched in 2017, evolved to include a selectable service in 2019 and real-time market analysis data integration in 2021, expanding to retirement pension products.