Korean-American banks across the U.S. have entered an era of intense nationwide competition. Previously, Korean-American banks primarily operated within the states and regions where their headquarters were located. However, in pursuit of new growth opportunities, these banks are now actively expanding into states far from their home bases.

For the past 40 years, an unspoken rule in the Korean-American banking sector has been that larger Southern California-based banks were proactive in expanding to the East Coast, while smaller Korean-American banks based on the East Coast, with relatively modest assets, rarely ventured into the West Coast.

This was largely due to the saturated market in Southern California, where six major Korean-American banks—Bank of Hope and Hanmi Bank (the top two in asset size), along with PCB Bank, Open Bank, CBB Bank, and US Metro Bank—compete fiercely. The presence of these six Southern California banks has historically posed a significant “entry barrier” for East Coast-based Korean-American banks.

Opening a branch in a distant state typically requires extensive market research, system upgrades to support the new branch, additional managerial staff, hiring local personnel, and securing real estate, all of which can cost hundreds of thousands of dollars and take considerable time. Failure to attract customers and generate revenue in these new markets could severely impact a bank’s profitability, creating significant operational risks.

This unwritten rule was broken in November 2020 when First IC Bank, headquartered in Georgia, opened a formal branch in LA’s Koreatown, marking the first time an East Coast-based Korean-American bank entered Southern California. This move by First IC Bank is considered a new milestone in the history of Korean-American banking.

Industry insiders predict that once First IC Bank, with assets of $1.2546 billion, completes its acquisition by MetroCity Bank, which has assets of $3.6942 billion, by the end of this year, the merged entity—with assets exceeding $4.8 billion—will likely pursue further branch expansion in the West Coast. For Southern California-based Korean-American banks, this means facing a formidable new competitor.

Additionally, last month, Hana Bank USA, headquartered in New Jersey, opened a branch in LA’s Koreatown, becoming the second East Coast-based Korean-American bank to enter Southern California. As the U.S. subsidiary of one of South Korea’s top four banks, Hana Bank USA aims to provide comprehensive financial services across both the East and West Coasts through its LA branch.

Industry observers are also speculating about the potential West Coast expansion of other East Coast-based banks, such as New Millennium Bank in New Jersey and PromiseOne Bank in Georgia. Meanwhile, Southern California-based Korean-American banks are accelerating their expansion into other states.

PCB Bank officially opened a new branch in Suwanee, Georgia, in July. Hanmi Bank launched its first Southeast branch in Duluth, near Atlanta, in June. CBB Bank opened a branch in Fort Lee, New Jersey, in May and plans to open another in Atlanta early next year. Open Bank, which already has branches in Texas and Nevada, is targeting New York, New Jersey, and Atlanta for its next out-of-state expansions. US Metro Bank, which operates a branch in Washington state, is also actively considering mid- to long-term plans to enter the East Coast and Southeast.

As a result, the competition to expand branch networks among the 15 Korean-American banks in the U.S.—comprising three banks headquartered in South Korea (Woori, Shinhan, and Hana) and 12 local Korean-American banks—is set to intensify further.