In 2021, Hana Financial Group’s annual net profit surpassed 3 trillion won for the first time in the company’s history, as increased loans and interest rate hikes significantly drove the growth of interest income.
Hana Financial Group said in its 2021 management performance released on Feb. 10 that it posted net profits of 3,526.1 billion won, up 33.7 percent (888.8 billion won) from a year earlier. It posted net profits of 844.5 billion won in the fourth quarter.
Its net profits in 2021 towered over a market forecast of 3.4 trillion won.
“We preemptively set aside provisions in consideration of the prolonged COVID-19,” a Hana Financial Group official explained. “But we achieved the best-ever business performances through even growth and stable cost management in the banking and non-banking sectors.” Hana Financial Group enjoyed a sharp increase in interest and commission profits, which drove the growth of its earnings in 2021.
In 2021, Hana Financial Group posted 9.3 billion won in key profits, including interest income of 7,437.2 billion won and commission profit of 1,863.4 billion won.
The figure represented a year-on-year increase of 15.2 percent, or 1.23 billion won. Among them, Hana Bank, a key affiliate, chalked up 6.87 billion won in interest and commission profits.
“The group’s general administrative expenses increased only 3.4 percent year on year as it successfully enhanced its cost efficiency through digital innovation,” the Hana Financial Group official said. “Effective cost management also brought about an earnings improvement, with its cost income ratio (CIR) sliding 1.3 percentage points year-on-year to 44.0 percent.”
Hana Financial Group’s non-banking sector also continued to grow steadily.
Hana Financial Investment posted a net profit of 506.6 billion won, up 23.3 percent, or 9.7 billion won, from a year earlier, thanks to an increase in overall core profits including asset management fees.
Hana Capital posted 272 billion won in net profits, up 53.5 percent (94.8 billion won) from a year earlier thanks to an increase in blue-chip retail assets.
Hana Card racked up a net profit of 250.5 billion won, up 62.2 percent (96 billion won) from a year earlier. Hana Asset Trust’s net profits amounted to 92.7 billion won, up 14.7 percent (11.9 billion won) from 2020.
As a result, Hana Financial Group’s share of profits in the non-banking business sector has been steadily growing. Its net profit in the non-banking sector stood at only 24.0 percent (574.7 billion won) in 2019 but climbed to 35.7 percent as it crossed 1 billion won for the first time in 2021 after hitting 34.3 percent (904.4 billion won) in 2020.
Hana Financial Group also plans to actively consider striking merger and acquisition (M&A) deals to strengthen its non-banking business.
“We will actively consider making M&A deals centered on the non-banking sector that can create synergies by strengthening our group’s business portfolio and enhancing digital capabilities in our ever-changing business environments,” said an executive director of Hana Financial Group’s Strategy Division in a conference call after the earnings announcement.
