NongHyup Financial Group Chairman Kim Yong-hwan said he always puts principles above all in solving problems.
When he was a fourth-grade officer with the Financial Services Commission, he went into the chairman’s office alone and debated the legality of selling Hyundai Securities, in an effort to stop the FSC from going ahead with the sale and help Hyundai Group from going bankrupt in 2003.
Then-FSC Chairman Lee Jeong-jai suspended the plan to sell the securities affiliate, upholding the objections to the financial authorities’ plan advanced by Section Chief Kim Yong-hwan in charge of the unit heads dealing with the financial policies for FSC.
He recalled that he was able to talk the FSC chairman out of selling Hyundai Securities because of his insistence on principles rather than the official process when it came to giving him strength to go to address directly the top senior official of the highest financial authority in the country. Hyundai Securities was also opposed to the sale, citing legal problems.
Chairman Kim passed the High Civil Service Examination in 1980 and entered the FSC as a clerk, in doing so launching his public service career. During his entire career, he never stopped insisting on giving priority to principles over all else to overcome crises. His style of leading a public service career paid off as he was named to head the Export-Import Bank of Korea in 2011-14 and to his current position in March 2015.
Kim is still an avid believer in principles and has so far been successful in leading NH Financial Group. The group posted 221.6 billion won in net profit in the first quarter this year, its largest quarterly net profit since 2012. As of April, that rose to 260 billion won. Owing to such an outstanding record, Chairman Kim became the first chairman to be retained to serve another term since 2012, when the group was set up.
He rose as high as senior vice chairman of the FSC in 2009-2011 and then was named to head the Exim Bank.
The chairman aims to boost the net profit of NH Bank as he begins his second term with the group by improving NIM and fees charged on the sale of bancassurance, which have been lower than those that other banks get. He also plans to close some of the bank’s branches across the county based on a “hub-and-spoke” plan to reform branch operations in connection with the application of Fintech in the bank’s facilities and operation.
The plan is to strengthen the roles of the seven hub branches across the country to create synergy with the spoke branches by forming clusters.
Ultimately, he plans to lead the bank to be among the five largest commercial banks in Korea by 2020, joining Shinhan Bank, Kookmin Bank, KEBHana Bank and Woori Bank. Part of his strategy involves laying the groundwork to make the bank’s operational structure so strong that any official can take over the job and the bank will be well on its way to be counted among the top five banks in the country.
As an initial move, he will see that loans for infrastructure will be hiked to 800 billion won from 300 billion won this year, and the bank will expand its operational area to the IB sector and others in a bid to expand its profit. On the 4th Industrial Revolution, he said the group will take advantage of such technologies as Big Data, AI and Robotics to provide tailor-made services to its clients.
Already, the group plans to have its financial affiliates including NH Card to set up the Big Data Strategic Group to create synergy among them by jointly using the customer data at the credit card firm. NH Life Insurance would be able to develop life insurance products based on Big Data satisfactory to its clients.
The group will also eye expanded intrusion into global financial market by taking over financial firms in Indonesia and Cambodia to kick off small credit loans, judging that high NIM in S.E. Asia would ensure high profits for its operations in the region. The group will also secure cooperative ties with local farmers’ cooperatives in the region to advance its operation in such critical areas as fertilizers, animal feed and farm machinery exports.
He reiterated that the group will reach Asian markets by cooperating with regional players, seeking to find new revenue sources outside the country.
Kim said that the country's second-largest financial group by assets is exploring business opportunities in China, Vietnam, Myanmar, Indonesia and Cambodia, considering buying stakes in local financial firms and setting up joint ventures.