Facing a desperate, knife-brandishing customer, Kwon Seon-joo knew the value of staying cool under pressure more than two decades before being picked to become the first woman to head a South Korean bank.
In 1992, the now 57-year-old chief executive officer of the country's fourth-largest lender by assets, Industrial Bank of Korea, was deputy manager of trade finance at a branch in an upscale district of Seoul.
Kwon said she agreed to meet a customer presenting forged shipping documents who was demanding a loan because he risked financial ruin after exporting artificial flowers that had been rejected by the recipient. When she refused, he lifted his trouser leg to reveal something tucked in his sock: a knife.
"I was shocked at first, but deep down I was confident that I could resolve the situation with conversation," Kwon said in an interview at IBK's headquarters in Seoul last month. She spoke calmly with the man for more than an hour before he walked out with his demands unmet and no one harmed, she said.
Now, having been chosen in December by South Korea's first female president, Park Geun-hye, to run the state-owned lender, Kwon intends to apply her temperament to a different challenge: making IBK one of the world's 100 largest banks on an international ranking by assets.
IBK was 105th last year on the Banker magazine's list, which includes closely held financial firms. Her goal for her three-year term involves expanding into emerging Asia, increasing loans to small businesses, cutting costs and boosting capital.
"I want to be remembered as a CEO who placed the cornerstone for IBK's future growth," said Kwon. "We'll grow, but not through the easy way of charging higher rates. I know it's a challenging goal because I want to ensure growth is healthy and stable."
To enter the top 100, IBK must overtake China Guangfa Bank of Guangzhou, China, The Hague-based Bank Nederlandse Gemeenten, Dublin-based Bank of Ireland, Canada's Desjardins Group of credit unions and Singapore's United Overseas Bank, according to the Banker's ranking.
IBK can achieve the target by the end of 2016 by increasing assets 5 per cent to 6 per cent annually, more than the average 3.9 per cent at global peers, Kwon said. Assets at Korean banks grew an annual 2.1 per cent on average in the past five years, according to Financial Supervisory Service data.
Kwon plans to expand into India, Indonesia and Cambodia to provide financing for Korean clients doing business there. IBK eventually will seek to serve local customers, too, she said. The lender has 23 branches or offices abroad including in New York, Tokyo, Hong Kong and London and has announced plans to open two more this year.
Kwon wants to tackle declining profit by trimming expenses and luring more customers from competitors. Broadening the client base would help IBK increase deposits and secure low-cost funding to expand loans to small businesses, she said, declining to provide specific targets.
The state-owned bank is required by law to allocate at least 70 per cent of its loans to small and medium-sized businesses. Kwon said she hopes increasing lending to them can help the country's policy of encouraging technology startups, in line with President Park's campaign promise before her election in December 2012 to achieve a more "creative economy."
"To me, creative finance means helping small companies and startups with their own technologies and knowledge so they can grow," Kwon said. "I want IBK to help such ventures so we can reinvigorate the economy."
Park pledged to spend 4 trillion won (NZ$4.3b) over the next three years to assist startups and venture companies and reduce the economy's reliance on large corporations. The central bank forecasts Korean economic growth will accelerate to 3.8 per cent this year, the fastest pace since 2010.
While women account for almost half of employees at banks in South Korea, few are executives. At the end of 2012, before Park's inauguration, five out of 95 vice presidents or deputy presidents at the eight nationwide banks were women, according to data compiled by CEOScore, a Seoul-based research firm. The number of women in those positions, just below CEO, has doubled as of February, the data show.
Korea's gender-equality minister, Cho Yoo-sun, said that increasing the participation of women in the workforce is "critical" to sustaining the growth of companies and economies.
"I often say that even though spring has come to the mountain, the mountaintop is still covered with ice," Cho said in a speech in Seoul. The Ministry of Gender Equality & Family plans to ask publicly traded companies to disclose the ratio of executives by gender to make them feel "peer pressure" to utilise more women, she said.
Kwon joined IBK in 1978 after studying English literature at Yonsei University in Seoul. She was one of the first five women to pass the company's entrance examination, according to a biography provided by the bank. Before Kwon, the bank along with its peers in Korea, typically only hired women for jobs such as tellers, which carry few opportunities for promotion.
Months after she was assigned to a branch in Seoul, Kwon was selected from dozens of candidates within the company to work as a secretary in the senior vice president's office.
"She looked smart in her photo and came from a good school," recalls Lee Kyung-jun, then Kwon's boss who recruited her and later became senior vice president. "She stood out."
Kwon wasn't satisfied with a low-level role.
"She protested that she joined the bank to become a branch chief one day, not to serve tea and greet guests," Lee said. "I had to persuade her that one day the experience will help her understand what executives do and how the bank works."
Kwon took the secretarial job, and her thorough work and passion for learning new assignments always impressed her bosses, Lee said. He said he wasn't surprised that Kwon later became IBK's first female division head and then deputy president after his retirement from the bank in 2008.
More than 20 years after defusing the knife incident, Kwon said her communication skills will help her manage any conflicts between shareholders, the government and customers.
"I always felt I'm a person who has room to improve," she said. "But one thing that I'm really good at is communication, and I believe that will help me meet my challenges."