Khan Bank JSC (Khan Bank) is a pioneer in Mongolia's financial market, with its "trust-based, inclusive-based" philosophy, demonstrating excellence in retail banking, SME financing, microfinance and digital finance. Founded in Ulaanbaatar in 1991 as Agricultural Bank of Mongolia, the headquarters is located in Khan Bank Tower, Chinggis Avenue-6, Stadium Orgil-1, Khan-Uul District, Ulaanbaatar 17010. As a listed company on the Mongolian Stock Exchange, Khan Bank is backed by major shareholders such as Sawada Holdings and Tavan Bogd Trade Ltd., serving about 2.8 million customers, covering 82% of Mongolian households, and is the largest commercial bank in Mongolia with its extensive network and innovative capabilities. The following is a comprehensive introduction to Khan Bank, covering its basic information, deposit and financing products, digital services, technological innovations, unique services and market position.

basic bank information

Khan Bank is a commercial bank, privately owned, founded in 1991 and headquartered in Ulaanbaatar, Mongolia. Formerly known as the Agricultural Bank of Mongolia, the bank is owned by herders and farmers and aims to serve agriculture and animal husbandry. Mired in crisis from 1996 to 1999 due to corruption and mismanagement, it was taken over by the Bank of Mongolia in 1999, and in 2000, with the support of the World Bank and the United States Agency for International Development (USAID), DAI Global implemented a restructuring plan to restore financial stability and privatize it through an international tender in 2003 and changed its name to Khan Bank. Sawada Holdings' acquisition of 100% of the shares, followed by the sale of 40% to Tavan Bogd Trade Ltd, is subject to compliance with the Banking of Mongolia Act and international financial standards to ensure operational transparency and the safety of customer funds. Their deposits are protected by the Mongolian Deposit Insurance Scheme, and the maximum amount of protection is determined by law (the exact amount needs to be checked with the bank). The SWIFT code for the bank is AGMOMNUB and the Legal Entity Identifier (LEI) is 5493003NOCSC6LUWUF03. With 547 branches, 1,275 ATMs, 144 self-service terminals and 30,000 POS terminals across the country, the bank will employ about 6,000 people in 2024.

deposit and financing products

depositsKhan

Bank offers a variety of deposit products to meet the savings needs of individual and corporate customers:

• Demand Deposits: including checking accounts and savings accounts, such as "My First Account" and "Altan Account", with a minimum opening amount of 0 Mongolian tugrik and an underlying expected profit rate (EPR) of about 0.5%-1.0%, subject to confirmation of the latest rate through branch or online banking. The Altan account attracts customers through points rewards and lucky draws, and the account supports flexible deposits and withdrawals, which is suitable for daily money management.

• Fixed deposits: Mongolian tugrik, USD, Euro and other currencies are supported, with deposit terms ranging from 1 month to 5 years, and the minimum deposit amount is 100,000 tugrik. In 2025, the expected profit margin will vary depending on the term, e.g. 3.0% for 1 month, 4.0% for 3 months, 5.0% for 6 months, 6.5% for 12 months, and 8.0% for 2-5 years. Invest in low-risk assets (e.g. government bonds, agriculture), and the profits are shared between the bank and the customer.

• Featured products:

  • High Yield Savings Accounts: such as "Altan Account", which offers an expected profit margin of up to 6.0%, requires maintaining a balance of more than 500,000 tugriks, combined with raffle rewards (such as cash or appliances), and no monthly fees.

  • Term Deposit Plus: Support flexible tenor, suitable for customers with large amounts of funds, the expected profit margin needs to be queried through the branch or app, and the early withdrawal penalty is 90 to 180 days of profit.
    Customers can check the expected profit margin through the "Khan Bank Mobile" app or online banking, deposit products can be opened and calculated instantly, and some accounts offer free transaction fees.

Financing Khan

Bank offers a comprehensive range of financing products that meet the needs of individuals and businesses, based on a model that complies with local regulations:

• Mortgage Finance: Fixed- and variable-rate mortgages with up to 70% of the value of the property for a term of up to 20 years. In 2025, the annualized profit margin will be about 12%-16% (based on the benchmark interest rate of the Bank of Mongolia, about 10%), and green financing discounts (energy-efficient properties) will be provided, and the application will require a credit score of more than 700 and an annual income of more than 5 million tugriks.

• Auto Finance: Support new and used car financing, with a financing amount of up to 50 million tugriks, a term of up to 5 years, an annualized profit margin of about 10%-15%, and a credit score of 660 or more.

• Consumer Loans: Financing amounts from 1 million tugriks to 50 million tugriks, with a term of 1 to 5 years, an annualized profit margin of about 12%-18%, and the application threshold is an annual income of more than 3 million tugriks and a good credit history, and the customer needs to be at least 21 years old.

• Flexible payment options: Mortgage and consumer finance offer no penalty for early repayment, monthly or bi-weekly payment options, and a revolving line of credit to give customers the flexibility to manage their debt. Livestock loans allow the use of movable assets such as livestock, geres (yurts) and other movable assets as collateral.
  All financing is subject to bank approval and requires credit history, proof of income or asset security, the specific terms of which are subject to the financing agreement. The bank's microfinance and SME financing, such as the 1.3 million IFC-supported women's entrepreneurship program in 2023, provide additional support to pastoralists and businesses.

digital service experience

Khan Bank's mobile banking app "Khan Bank Mobile" is the core of its digital services, which can be downloaded on iOS 14.0 and above, Android 9.0 and above, with an App Store rating of about 4.8 and a Google Play rating of about 4.7, with 1.7 million users in 2022, accounting for nearly 50% of Mongolia's population. The core functions of the app include:

• Face recognition: supports biometric authentication (such as Face ID and Touch ID), combined with 256-bit end-to-end encryption, and introduces AI-driven face recognition for the first time to enhance security.

• Real-time transfers: Supports instant Tugrik transfers through the Mongolian Payment and Clearing System and QPay (Mongolia's first QR code payment service), with a daily limit of up to 100 million Tugrik, international remittances cover more than 30 countries, and cooperates with Western Union to provide low-rate transfers.

• Bill management: Support online bill payment, automatic deductions (such as utility bills, mobile phone recharges) and e-statements, classify transactions in real time, and allow up to five bills to be paid at a time.

• Investment Tool Integration: Support stocks, funds, and bond investments through the Smart Wealth platform, providing real-time market data and advisory services.
  The online banking "Khan Bank Online" supports multiple browsers, customers can open an account within 5 minutes through the app or official website, and visually impaired customers can access digital banking through voice assistance. In 2022, 99% of transactions were completed through digital channels, saving 1.3 million A4 sheets per month. The bank supports Apple Pay, QPay, and offers 24/7 call center support (hotline 1800-1917).

technological innovationKhan

Bank excels in the fintech sector, driving technological advancements through its Group Digital Office:

• AI customer service: Introduce an AI-driven customer service system to analyze transaction behavior, detect fraud risks in real time, automate 80% of customer inquiries by 2023, and plan to launch a virtual assistant in 2025 to support 24/7 inquiries and personalized recommendations.

• Open Banking API Support: Following the Bank of Mongolia's Open Banking Framework, it integrates with third-party payment platforms to provide interoperability for account management and payment scenarios, and supports 35 payment and financing service APIs by 2024.

• Blockchain payments: In 2023, we will pilot blockchain QPay payments to simplify cross-border transactions and microfinance payments and improve transparency.

• Robotic Process Automation (RPA): In 2022, it won Asiamoney's "Best Bank for Digital Solutions" award for automating 10 cross-departmental processes (e.g. loan approval, bill processing) to improve efficiency.

• Other innovations: Introducing Mongolia's first digital signature in 2018, investing 10 billion tugriks to upgrade cloud technology and data analytics platforms in 2024, and partnering with ServiceNow to optimize IT service management (ITSM).

Featured Services & Differentiation

Khan Bank is known for its rural micro-financial services and innovative digital solutions

• rural microfinance: serving 98% of rural communities, herders can use movable assets such as livestock and geer to secure loans, and the balance of microfinance loans will account for 30% of the loan portfolio in 2023, supporting nomadic herders and small and medium-sized enterprises.

• Women's Entrepreneurship Support: In 2023, we received US$1.3 million in financing from the International Finance Corporation to support female small and medium-sized business owners, with loans approved in as fast as 10 seconds and up to 50 million tugriks, and the balance of women's loans increased by 15% in 2023.

• Green Finance: Participated in Mongolia's first green bond (US$60 million, with a US$10 million investment from MicroVest) to support renewable energy and green agriculture, and responded to the UN Global Compact to raise 5 billion tugriks in green financing in 2023.

• Khan Business Incubator: Providing SME incubation space, consulting and training, supporting 500 SMEs in 2023 with a 12% increase in loans.

• Community Contribution: Support education and health projects such as the Global Money Week 2024 Financial Literacy Campaign through the Khan Bank Foundation, and donate 1 billion tugriks for community development in 2023.

market position and honors

Khan Bank is the largest commercial bank in Mongolia, with total assets of about US$5.1 billion (about 17 trillion tugrik) in 2024, accounting for one-third of Mongolia's banking industry, with a loan portfolio of US$2.8 billion and equity of US$612.7 million. With 547 branches serving 82% of Mongolia's population (about 2.8 million customers), the bank dominates the retail banking, microfinance and SME financing sectors. In 2023, the deposit balance increased by 8%, the financing balance increased by 6%, and the non-performing loan ratio decreased to 6.2% (at the end of 2023). Khan Bank's innovation in the field of digital transformation and green finance has allowed it to maintain its leading position in the Mongolian market. The bank received a Moody's rating of B3 (Stable Outlook) and was awarded the "Mongolian Bank of the Year" award by International Finance in 2023. Key accolades include:

• the 2023 International Finance "Mongolian Bank of the Year" award.

• Asiamoney 2022 "Best Bank for Digital Solutions in Mongolia" award.

• Euromoney "Best Bank in Mongolia" award 2018.
  Khan Bank's financial inclusion and innovation capabilities make it the backbone of Mongolia's financial market.

With its 34-year heritage, inclusive services and innovative financial products in rural Mongolia, Khan Bank Co., Ltd. has become a pioneer in Mongolia's financial market. It offers a diverse range of deposit and financing products to meet customer needs through 547 branches and advanced digital platforms. The digital services are centered on the "Khan Bank Mobile" app, which provides efficient real-time transfers, bill management, and investment functions. Technological innovations include AI customer service, open banking APIs, blockchain payments, and QPay, demonstrating its forward-looking digital transformation. With its rural microfinance, women's entrepreneurship support, green finance, Khan Business incubator and several industry accolades, Khan Bank continues to demonstrate strong competitiveness and influence in Mongolia's financial market.

Note

• specific expected profit margin and financing details may vary due to market changes, please check the official website of Khan Bank or contact the bank directly for the latest information.