South Korea’s first app-based lender Kbank has been cleared to go public, but whether it will proceed with the initial public offering within the year is uncertain, given the lackluster demand and market conditions.

Korea Exchange on Tuesday gave a go-ahead for Kbank’s preliminary application for Kospi debut.

Kbank, the country’s first online-only bank founded in 2016 – raised 22.5 billion won ($16.2 million) in net profit and 287.8 billion won in operating revenue on a separate basis last year. It reaped 45.7 billion won in net income in the first half this year, doubling last year’s performance thanks to rising interest rates.

Kbank has 13.3 trillion won in total assets and 1.7 trillion won in equity capital. BC Card, a subsidiary under KT Corp., is the largest shareholder of Kbank with 33.7 percent stake. NH Investment & Securities, JP Morgan, and Citigroup Global Markets are lead managers for the IPO.

Upon preliminary approval, Kbank must go public by March at the latest. Although the bank repeatedly vowed to go ahead with an IPO within the year while it is on a profit streak, it has become nervy from the chain flops in earlier IPOs on market insecurity from aggressive tightening actions across the world.

Its rival KakaoBank Corp. that went public on Aug. 6 last year in much fanfare has seen its stock price halved this year. KakaoBank debuted at 53,700 won, 37.7 percent higher than its IPO price of 39,000 won. Shares finished Tuesday at 25,250 won.

Kbank’s market capitalization was initially projected at around 10 trillion won, but its IPO now is estimated to be worth no more than 4 trillion won.

“KT wishes an IPO valuation of at least 7 trillion won,” said Kim Hong-sik, an analyst at Hana Investment & Securities. “Given the gap, KT would best wait until market conditions improve,” he added.

Hana Investment & Securities projects Kbank would opt to go public next year.

“We will flexibly decide when to submit final prospectus after comprehensive study on market conditions,” said an unnamed official from Kbank.

By Park Yoon-ye and Lee Eun-joo

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