Chairman Cho Yong-byeong of Shinhan Financial Group delivers his congratulatory speech at a ceremony marking the group’s 18th anniversary on Sept. 2. (Photo: SFG)

Chairman Cho Yong-byeong of Shinhan Financial Group said boosting the profits of customer assets should be the key to the group’s performance evaluation at a ceremony marking the group’s 18th founding anniversary held on Sept. 2.

The event was held at the group’s head office building on Sejong Boulevard in downtown Seoul.

In his commemoration speech, Cho called for making the group “a top-class Shinhan.”

The financial group first launched its operation in 2001 as the nation’s first financial holding company, whose affiliates now total 16 including Shinhan Bank, Shinhan Card, and Shinhan Financial Investment, leading all of its rival financial groups in such key areas as total assets, net profit and market value.

The chairman, analyzing the key areas of its operation, said “now, the group has come to the point where it should the top-class financial group over its 1st ranking among the financial groups, as the group’s new challenges.”

The group’s top-class ranking should be judged by customers, not the officials of the group, he explained, adding that the group now should work for boosting the customers’ assets as a basic to its responsibility.

Shinhan Financial Group will actively pursue acquisitions in Asia’s emerging markets that can help it take a “leap up and forward” overseas, according to Cho Yong-byeong, chairman of the listed financial holding company.

With its huge war chest of more than 20 trillion won ($18 billion) in cash, the group will seek targets on the same or a similar scale as the deal it sealed to acquire ANZ Bank's retail operations in Vietnam last year.

“The group will search for opportunities like the ANZ deal that spurred Shinhan to become Vietnam's top foreign-invested bank,” Cho said. “We will pursue deals by comprehensively assessing the growth potential of the markets and our businesses as part of the group’s inorganic growth strategy.”

The group is particularly eyeing Asian emerging markets including Indonesia and India, while further fortifying its Southeast Asian base in Vietnam.

Shinhan Bank made inroads into Vietnam in 1993. Shinhan Bank Vietnam has total assets of $3.4 billion, with 1.1 million customers using its services there, the Korea Federation of Banks said. The group has 19 overseas subsidiaries, according to its semiannual financial report.

It will also aggressively seek targets here. Shinhan Financial is currently in talks to acquire ING Life Insurance from MBK Partners, a local private equity giant.

Market analysts expect the acquisition could cost the group more than 2 trillion won. Shinhan Financial has been issuing a series of hybrid bonds both at home and abroad. Some of the capital it raised through such bonds could be used to finance its future deals, said a source familiar with the matter.

Cho added the group will move forward with a “two-track strategy” focusing evenly on growing its bank and nonbanks organically and inorganically abroad.

The strategy would not only have to help the group generate synergy among its subsidiaries, but also help it “develop, upgrade and strengthen its business model that can best fit the local market environment.”

It is especially seeking to push the group's nonbanks such as credit cards, investment banking and insurance to advance overseas under its organic roadmap, Cho said.

This is part of the group’s efforts to generate 20 percent of total net profit from its overseas business by 2020, up from the current 13 percent. Early last year when Cho was inaugurated as the Shinhan chief, he introduced his “2020 Smart Project” vision for the group. This includes putting the “Global One Shinhan” strategy into action.

Besides maximizing synergy among its banks and nonbanks, Cho told Reports said that the group will seek to “balance growth” between its bank and nonbanks overseas by developing new business models and differentiated services.

“This mid-term goal is aimed at generating value that can help develop Shinhan's global systems and enhance its capability for sustainability,” Cho said.