K Bank's loan balance to sole proprietors has exceeded 3 trillion won, strengthening its competitiveness in corporate finance.

K Bank said on May 18 that its loan balance to sole proprietors topped 3 trillion won as of May. The balance has increased by 1 trillion won in about six months since it surpassed 2 trillion won in November last year.

The growth was driven by guarantee-backed loans and property-secured loans. The guarantee-backed loan balance rose 76 percent to 580 billion won this month from 330 billion won at the end of last year.

K Bank is expanding the scope of cooperation with regional credit guarantee foundations and local governments. It is also strengthening product competitiveness by launching an overdraft-style guarantee-backed loan product linked to the Seoul Metropolitan Government.

The balance of the "Boss Real Estate Secured Loan", the first 100 percent non-face-to-face product among internet-only banks, also rose 40 percent to 780 billion won from 560 billion won at the end of last year.

According to disclosures from the Korea Federation of Banks, K Bank's average interest rate on sole proprietor secured loans stood at 3.44 percent per year as of the end of the first quarter, the lowest level among banks. K Bank said refinancing is possible not only for bank loans but also for loans from second-tier financial institutions such as savings banks, card companies and capital firms, helping ease interest burdens for small business owners.

It also expanded credit supply to mid-to-low credit borrowers. As of the end of the first quarter, the share of mid-to-low credit borrowers in the balance of sole proprietor unsecured loans was 34 percent.

Soundness indicators also improved, with the delinquency rate falling to 0.55 percent in the first quarter this year from 1.38 percent in the first quarter last year.

A K Bank official said, "Since building a full lineup of unsecured, secured and guarantee-backed loans, we have maintained balanced growth across all areas." The official added, "We will expand the corporate finance business beyond sole proprietors to small and medium-sized enterprises."