Chairman Kim Gwang-soo of NH Financial Group. (Photo: NH Financial Group)

NH Nonghyup Financial Group posted a record 1,779.6 billion won in net income in 2019. Its net income was the highest since the company was founded in 2012.

It is also an improvement of 46 percent from 2018’s 1,218.9 billion won. NH Nonghyup Financial Group annually invests in support for farmers, agriculture and rural villages, and achieved the milestone of 2 trillion won (2.69 trillion won) in net income.

The company paid 413.6 billion won to support for farmers, agriculture and rural villages for the first time. “An increase in non-interest income and a significant decrease in provisions for credit loss were the main contributors to the best-ever business performance,” a group official said.

Interest income edged up to 7,830.4 billion won, up 0.43 percent, from 2018. Non-interest income, on the other hand, climbed by 532.6 billion won to a deficit of 53.5 billion won.

“The group’s non-interest income expanded a great deal as NH Nonghyup Bank made a big improvement to securities management while NH Investment & Securities and NH Life Insurance increased their profit,” the official said.

Its provisions for credit loss also fell 51.3 percent to 358.2 billion won, positively affecting the group’s profits.

“We were able to reduce bad account cost by reversing provisions to large corporations with large loans such as shipbuilders,” the official said. “In addition, we could reduce related cost by amortizing or selling non-recoverable and non-performing loans.”

Its ROE continued to rise to 8.65 percent and its ROA 0.41 percent. ROE before expenses for agricultural support rose 10.06 percent, to a high level in the industry, up 2.13 percentage points from the previous year. Its NPL ratio stood at 0.63 percent.

The group’s total assets hit 427.1 trillion won and total capital to 24.7 trillion won, growing 2.4 percent and 10.3 percent year on year, respectively. Won-denominated loans grew 5 percent year-on-year. By sector, household loans rose 8.7 percent and corporate loans 6.2 percent.

Nonghyup Bank, the flagship subsidiary of NH Nonghyup Financial Group, posted record high net profit of 1,517.1 billion won, up 24.1 percent year on year. The lender’s earnings improved through sound credit policies, preemptive loan management, and solid assets.

In the insurance industry, which struggled in 2019, NH Nonghyup Life Insurance turned a net profit of 41.0 billion won from a net loss of 114.1 billion won in 2018.

“Chairman Kim Kwang-soo of Nonghyup Financial Group organized and has run insurance innovation task force team. The team played a major role in overcoming the crisis,” an NH Nonghyup Financial Group official said.

NH Investment & Securities posted 475.5 billion won in net income, up 31.8 percent from a year earlier. In addition, NH Nonghyup Non-Life Insurance, NH Capital, NH-Amundi Asset Management and NH Savings Bank posted 6.8 billion won, 50.3 billion won, 21.7 billion won and 18.1 billion won in net income, respectively.

NH Nonghyup Financial Group decided to invest 1.2 trillion won in digital infrastructure construction in October 2019.

At that time, the group put forward a plan to push forward with four tasks - bringing innovation to customer experiences, enhancing operational efficiency through digitalization, advancing into new digital businesses and operating itself as an agile organization and fostering digital talent.

“The digital transformation of Nonghyup Finance does not appear in accounting indicators but take effect by mixing well with each item,” a group official said.

“We have made endeavors to elevate our operational efficiency by introducing AI systems among other. It paid off handsomely.”