The largest net profit realized due to improved net profit margin and balanced growth in non-interest earnings including fee incomes and loan loss provision cut to 29.9 bln won
Chairman Kim Jung-tae of Hana Financial Group. (Photo:HFG)
The Hana Financial Group logged the largest first-half net profit since setting up as a holding company at 1.303,8 trillion won, the group announced on July 20. The figures are up 26.5 percent YoY, the largest since the group came out with a holding company system in December 2015, the group said.
The group attributed the outstanding performance to the improved net interest margin and the boosts in fee incomes from the sale of financial products and other non-interest incomes for the first-half performance record.
The group explained that the interest incomes totaled 2.742 trillion won in the first half to bring first-half earnings to 3.945,1 trillion won, up 15 percent YoY or 515.6 billion won. The group declared a dividend of 400 won per share in the first half.
The KEB Hana Bank, a major affiliate of the group, recorded the first-half net profit of 1.193,3 trillion won with the second quarter NIM coming to 1.57 percent, up 0.09 percent YoY while its loan loss provision came only to 29.9 billion won thanks to tough risk management, down 92.2 percent YoY.
Hana Financial Investment, another affiliate of the group, netted 106.5 billion won in profit in the first half, up 83.6 percent YoY while Hana Card posted first half net profit of 516 billion won with 261 billion won from the second quarter.
KEB Hana Bank has arranged a $280 million syndicated loan to the biggest owner of the Ritz-Carlton hotel in Manhattan from a pool of South Korean financial institutions and a Japanese bank, as Korean financial institutions are seeking to fill the void left after China and Japan slowed down investment in the United States.
KEB Hana, part of South Korea’s Hana Financial Group, signed a credit agreement with New York-based Westbrook Partners to extend the five-year senior loan secured on the property on April 3, according to a local business daily in Seoul on April 5.
Westbrook owns 51% of the hotel, while Korea Investment Corporation, a sovereign wealth fund, holds the remaining 49% after buying the equity interests in 2016.
A pool of South Korean banks, brokerage firms and insurance companies participated in the syndicated lending group, including KEB Hana Bank, Mirae Asset Daewoo Co. Ltd., Samsung Securities Co. Ltd., Kyobo Life Insurance Co. Ltd. and Hana Life Insurance Co. Ltd.
The Japanese bank in the lending group was not identified.
Westbrook Partners, a real estate investment company, had reportedly sought a $300 million floating-rate loan with a five-year term on the luxury hotel.
It intended to use the proceeds of a new loan to repay a $135 million loan and renovate the property at 50 Central Park South, Commercial Mortgage Alert, a US publication, reported in August 2017.
Built in 1928, the hotel that faces the Central Park was converted into a hotel and residential-condominium property in 1999.
Westbrook has been trying to convert the hotel portion of the building, valued at $500 million, into residential condominiums.
A conversion of the hotel portion into condominiums would create an additional value of $130 million, according to the Korean newspaper. The 298-room hotel occupies the first 12 floors of the building, and a 120-unit condominium fills the upper 26 floors.
KEB Hana Bank’s New York branch, instead of its Seoul headquarters, arranged the loan, which became the biggest syndicated loan extended by a South Korean bank’s New York office to a US company.
The outstanding loan volume of KEB Hana Bank’s New York branch is $1.2 billion, half of which is owed by U.S. companies.