NH Bank¡¯s first-half profit amounted to around 300.2 billion won, up 150 percent compared to the same period last year. That rises to 452.8 billion won if fees paid to the NACF are counted. The fees went towards the use of its name, Nong Hyup or NH for short, raising projected net profit for the whole of this year to exceed 1 trillion won.
First-half profits at NH Bank¡¯s affiliates rose some 179.9 billion won from the same period last year, which is well over the projected first half profit, set at 290 billion won. It is the first time that NH Bank has made profit in the first half of the year since 2008.
President Kim Ju-ha credited the hard work that every employee of the bank put in to improving operations this year, despite poor economic conditions and low interest rates on loans. ¡°I am tearfully appreciative of every employee¡¯s hard work for the bank,¡± the CEO said at a meeting of the executives of the bank to discuss the results of the bank¡¯s first half operation on Aug. 17.
CEO Kim sent 6,000 fried chickens to each of the bank¡¯s branches and outlets around the country to thank them for their hard work. The occasion also marked the commemoration of the bank¡¯s outstanding performance.
Kim said the Q2 profit was greater than Q1, and if the trend continues in the second half, total profit might exceed 1 trillion won for the whole year.
The biggest factor for the unexpected increase profit for the bank has been the reduced loan loss provision by 246 billion won. The interest earnings also rose by 337 billion won despite the low loan interest rates, helped by a boost in total assets, officials of the bank said.
Another big factor was a large increase in non-interest income, such as commissions from the sales of bankcassurance, and securities and retirement funds, which came to around 599 billion won in the first half.
An extension of the National Agricultural Cooperative Federation¡¯s financial operations, NH Bank was established in March 2, 2012 with purely domestic, private capital.
Since its foundation in 1961 as a comprehensive agricultural cooperative, it has been recognized as the safest bank in Korea and as the most advanced cooperative financial institution around the world thanks to its half-century proven track record in financial operations. By fully assuming its role as the profit center of the cooperative while at the same time securing global competitiveness, NH Bank will continue to serve our financial industry as the country¡¯s best bank.
¡°With our unwavering focus on customer satisfaction and happiness, we pledge to bring even greater satisfaction and services to our 20 million customers,¡± the bank said.
Nonghyup Financial Group Inc., South Korea's fourth-largest banking group by assets, is considering buying banks in Indonesia and Myanmar in a bid to expand its overseas business and diversify its portfolio, the group's chairman said Monday.
Nonghyup Financial is the biggest state-run agricultural cooperative whose stakeholders include farms and other agricultural businesses. It is expanding its business from commercial banking to brokerages, insurance and asset managing. Its flagship Nonghyup Bank ranks fourth in terms of assets after Woori Bank, Shinhan Bank and Kookmin Bank.
"We have a wide network involving farming, livestock and financial businesses in South Korea. We will try to develop these strong points and advance to the overseas market," Nonghyup Financial Chairman Kim Yong-hwan said in an interview with Yonhap News Agency.
"In the second half, I will focus more on overseas expansion to help Nonghyup Financial diversify its business portfolio and strengthen non-interest income."
He said the company is mulling making equity investments in banks or leasing companies in Asian countries, or acquiring a managerial stake as the first step toward tapping into local financial markets.
It has formed a panel of leaders from its banking, insurance and brokerage affiliates to map out a plan for overseas investment. The panel is carrying out feasibility studies on its entry into the financial markets of Myanmar, Indonesia, Vietnam, China and Cambodia.
Kim said banks in Indonesia and Myanmar are on the company's top wish list, but refused to disclose the names of target institutions.
"Korean banks' overseas branches do business with Korean companies and Korean people. But they don't make profits," he said. "Our overseas businesses will engage in business that yields good returns."
Nonghyup Bank ran four overseas branches as of March, while NH Investment & Securities Co. had nine overseas businesses, including one in Hong Kong.
Along with the overseas expansion, the chairman noted that he is seeking to reorganize banking units in South Korea in a bid to keep up with the mobile banking trend. He said he will shutter less-profitable offices outside Seoul and open some 30 branches in the capital instead.
"Young customers in their 20s and 30s rarely visit bank offices in person. They engage in everyday banking transactions through mobile," he said.