Will Jeonbuk become Korea's next financial district?

Jeonbuk State’s push to position itself as South Korea’s next financial anchor is picking up pace as major lenders move to formalize expansion plans in the southwestern region, pledging new operational bases backed by local authorities.

Earlier this week, the country’s two largest banking groups said they had selected Jeonbuk as a strategic foothold for key subsidiaries, outlining plans to open new offices and relocate staff.

KB Financial Group on Wednesday said it will build “KB Finance Town” in the province, bringing together its asset management, securities brokerage, banking and insurance units. About 250 employees are expected to be assigned to the site, which the group aims to develop not as a simple regional outpost but as a network hub integrating asset management capabilities across its affiliates.

Shinhan Financial Group followed on Thursday, naming Jeonbuk as its new base for asset management and capital markets operations. The group said it plans to establish an integrated pipeline spanning investment, trust services and risk management, with roughly 300 financial professionals to be deployed to the new center.

Located about 200 kilometers south of Seoul, Jeonbuk State, also known as North Jeolla Province, hosts the asset management headquarters of the National Pension Service, the nation’s largest institutional investor.

The recent announcements mark a renewed push in Jeonbuk’s long-running bid to secure designation as the country’s third financial hub after Seoul and Busan, an ambition that has remained stagnant for more than six years.

Momentum has returned under President Lee Jae Myung, who revived the agenda during his campaign and has since publicly called for faster progress. Lee has urged the government to introduce incentives to accelerate the designation process, including measures linked to the NPS.

With the NPS overseeing about 1,400 trillion won ($964.2 billion) in assets, the third-largest pool among global public pension funds, potential policy incentives such as preferential treatment in fund management mandates for firms operating in Jeonbuk are seen as a key lever in shaping the region’s appeal to asset managers.

Meanwhile, reports Friday showed that Jeonbuk’s provincial government recently submitted its application for designation as the country’s third financial hub to the FSC. Originally planned for late last year, the filing was delayed after regulators called for a more detailed roadmap, including a concrete plan to attract financial institutions.

The province pitched itself through a specialized model anchored on the NPS, connecting asset management with the agricultural bioscience, climate and energy industries to distinguish itself from Seoul’s broad-based financial center and Busan’s maritime and derivatives-focused hub.

Under the proposal, the designated financial zone would cover about 3.6 square kilometers across Jeonbuk Innocity and Manseong-dong. Development is set to proceed in three stages, dividing the area into a core business district for key financial institutions, a supporting business district, and an inland residential district for financial professionals.